The buzz surrounding stablecoins is intensifying, especially among startups focused on remittances and international payments, eager to pioneer the use of these digital currencies. But does this enthusiasm reflect a well-founded opportunity?
Recently, Zepz-a UK-based fintech unicorn that owns platforms like WorldRemit and Sendwave-announced plans to incorporate stablecoins into Sendwave’s remittance services, which span over 100 countries. Meanwhile, established giants like MoneyGram and Western Union have been quietly testing stablecoin wallet functionalities. Adding to this momentum, Wise, a key player in global transfers, recently appointed a leader focused exclusively on digital asset offerings.
What’s driving this swift adoption of blockchain-based currencies? According to a COO at a cross-border fintech that recently integrated stablecoin payments, the main incentive is to capitalize on emerging technologies and stay ahead in a fiercely competitive market. As more influential companies embrace stablecoins, these digital currencies gain credibility and broader market acceptance.
However, stablecoins pegged to the US dollar raise significant concerns, particularly regarding their potential impact on a country’s monetary independence. This issue was underscored by Chai Gang, deputy director of payment systems at the Central Bank of Nigeria, during a recent TechCabal Moonshot panel.
While the advantages of quicker transactions and enhanced user experience are clear, regulators remain cautious, meticulously assessing the risks stablecoins might introduce. Sendwave, which operates extensively across African nations including Kenya, Uganda, Tanzania, Ghana, Nigeria, Senegal, and Liberia, is a leading digital remittance platform. Its move to adopt stablecoins could prompt regulatory authorities to reconsider and possibly revise their frameworks governing digital currencies.