UN Economist: Stablecoins Outpace Aid for Remittances in Africa
Former UN under‑secretary‑general Vera Songwe told the World Economic Forum that stablecoins are increasingly more impactful than traditional foreign aid for many Africans. Citing high remittance costs (about $6 per $100) and slow banking corridors, she said stablecoins enable near‑instant, lower‑cost cross‑border payments via mobile rails, improving net receipts for families and SMEs and advancing financial inclusion for an estimated 650 million unbanked Africans with smartphones. Songwe noted stablecoins’ fiat pegs reduce volatility versus other crypto assets and highlighted institutional activity: payments platforms exploring digital rails and central banks researching CBDCs. She warned of uneven regulation, internet and digital‑literacy gaps, and consumer‑protection risks, and linked stablecoin adoption to AfCFTA goals of boosting intra‑African trade. For traders, the shift signals growing on‑chain remittance flows and regional stablecoin demand as indicators to monitor—alongside regulatory developments and CBDC pilots that could reshape settlement rails. Overall, stablecoins present durable utility for remittance efficiency and economic integration in Africa, while aid remains important for emergencies and infrastructure.
Bullish
The news is bullish for stablecoins and related on‑chain payment volume. Songwe’s remarks highlight growing real‑world utility for stablecoins—faster settlement, lower fees and use as an inflation hedge—which is likely to increase demand and transaction volume in African corridors. Short term, traders may see rising on‑chain flows and higher stablecoin volumes as remittances shift from traditional rails; this can boost liquidity and fee generation in stablecoin markets and increase activity on chains commonly used for remittances. Medium to long term, broader adoption could encourage integration by payment platforms and greater use of stablecoins in SME trade, supporting sustained demand. However, regulatory uncertainty, potential CBDC rollouts and infrastructure hurdles pose risks that could moderate growth or shift volumes to alternative rails. Overall, net effect favors higher demand for stablecoins, so price/usage indicators for major fiat‑pegged tokens and their underlying chains are likely to trend upward—hence a bullish outlook.