The International Monetary Fund (IMF) has warned that the rapid expansion of stablecoin usage in Nigeria could significantly weaken demand for the naira and reduce the effectiveness of domestic monetary policy, even as the country records about $59bn in crypto-asset inflows between July 2023 and June 2024.
The IMF said in it’s report titled “Stablecoins in Nigeria: A Growing Cross-Border Channel,” that the growing adoption of dollar-pegged digital assets for payments, remittances, and savings reflects deeper macroeconomic pressures in Nigeria, including elevated inflation, foreign exchange scarcity, and persistent currency depreciation.
According to the Fund, these conditions have increased the attractiveness of stablecoins as both a store of value and a medium of exchange, particularly among individuals and businesses seeking stability amid exchange rate volatility.
The IMF warned that the widespread use of U.S. dollar-denominated stablecoins effectively represents a form of “digital dollarisation,” which could erode demand for the naira and weaken the Central Bank of Nigeria’s (CBN) ability to transmit monetary policy through interest rates and exchange rate interventions.
Nigeria remains one of the world’s most active digital asset markets, ranking second globally in Chainalysis’ 2024 Global Crypto Adoption Index and sixth in the 2025 edition.
The IMF further noted that the country accounts for nearly 60 per cent of stablecoin inflows into sub-Saharan Africa since 2019, underscoring its dominant role in regional crypto activity.
The report also highlighted the appeal of stablecoins in reducing transaction costs and improving the speed of cross-border payments.
However, the IMF cautioned that the increasing shift of payment activity from traditional banking systems to crypto exchanges and digital wallets may create regulatory blind spots.
It warned that such developments could complicate the monitoring of capital flows and increase exposure to illicit financial risks, including money laundering.
Despite these concerns, the Fund did not advocate restrictive measures. Instead, it called for a balanced policy approach that addresses the structural drivers of stablecoin adoption while strengthening oversight frameworks.
Key recommendations include maintaining macroeconomic stability to support the naira, enhancing regulatory clarity for stablecoin-related activities, and strengthening coordination between the Central Bank of Nigeria (CBN) and the Securities and Exchange Commission (SEC).
The IMF also urged improved transaction data collection through blockchain analytics and continued investment in efficient, regulated payment infrastructure.
The Fund noted that stablecoin growth is largely driven by inefficiencies in cross-border payment systems, stressing that policy efforts should focus on narrowing these gaps while ensuring emerging risks remain effectively contained.
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