African stablecoins face retail hurdles as wholesale use grows

African stablecoins have seen modest on‑chain growth, but retail adoption remains weak while wholesale use cases gain traction. As of September 21, Nigeria’s cNGN supply crossed ₦3.75 billion (about $2.82 million), South Africa’s ZARP had roughly R74.6 million ($4.6 million) in circulation backed by R92.8 million reserves, and Tanzania’s nTZS tokens exceeded 9.66 million, up from 6.2 million in July. Despite these figures, the combined stablecoin market is still dominated by dollar‑backed tokens, which make up 99.4 % of the estimated $320 billion total. Local stablecoins struggle to attract everyday users because converting via a naira stablecoin adds an extra step when users already hold USDT and can cash out directly to bank accounts. However, a wholesale case is emerging: payment firms, developers and liquidity providers are using nTZS and cNGN as on‑chain rails for cross‑border settlement, treasury management and foreign‑exchange flows. For example, Nigeria’s HyperFX platform settled ₦573 million ($430,910) in cNGN through 45 orders, averaging ₦12.7 million per transaction, showing the tokens serve larger‑value moves rather than retail payments. Market makers can earn spreads of 0.1‑0.4 % on such trades, potentially yielding $100‑400 thousand monthly at scale. Regulators in Nigeria, Kenya and Tanzania are monitoring yield‑generating activities, warning that passive returns could compete with bank deposits. The outlook suggests local stablecoins may find utility as the local leg in dollar‑stablecoin transactions, provided exchanges, wallets, market makers and redemption channels are built. Will institutions continue to back these tokens once speculative incentives fade, or will the wholesale niche prove enough to sustain them?

SOURCE: https://techcabal.com/2026/09/21/is-the-use-case-for-local-stablecoins-big-enough/