Africa Emerges as the New Frontier for Crypto Amid Currency Strains

By Aksah Italo
Published on 12/11/25

For the longest time, China was the world’s dominant hub for Bitcoin mining, until the country banned the practice in 2021, citing its heavy environmental footprint. The industry quickly migrated to the United States, where cheap energy and deep capital markets turbocharged profits. Within months, the country accounted for roughly a third of global Bitcoin output.

Now a new frontier is opening.

Cash-strapped, African states with weak currencies, many with abundant and largely untapped renewable-energy resources, have begun attracting miners particularly from China and Russia. The continent hosts 60 percent of the world’s best solar-generation sites, and several African countries rank among the cheapest electricity markets globally. Over the past three years, several dozens of crypto-mining ventures have moved into these markets, lured by low power costs and minimal competition.

Across the continent, cryptocurrency usage has grown dramatically, not as a speculative fad, but as a functional response to weak currencies, high remittance costs and banking gaps.

In 2024, stablecoins made up 43 percent of all crypto transaction volume in Sub-Saharan Africa. Kenya, Nigeria and South Africa lead the region’s user base. Nigeria alone counts about 22 million crypto owners, nearly 10 percent of its population.

Between July 2023 and June 2024, Nigeria processed nearly 22 billion dollars in stablecoin transactions, making it the continent’s largest market. Other countries, Ethiopia, Ghana, Zambia, and Uganda are experiencing parallel adoption, much of it driven by inflation, currency depreciation and restricted access to foreign exchange.

Stablecoin (USD-pegged tokens), particularly, serve three urgent economic needs in Africa. As local currencies lose value, dollar-linked tokens offer a stable store of value and a shield against rapid depreciation.

In a world where traditional remittance systems into and within Africa remain slow and expensive, crypto rails dramatically cut both fees and settlement time. Importers, exporters and payroll operators have now begun to use stablecoins for supplier payments, treasury operations and dollar liquidity, especially where foreign currency shortages and bank delays are common.

The continent’s crypto evolution is shifting from consumer payments toward structured trade and settlement systems. A landmark 2025 initiative led by the IOTA Foundation, African Continental Free Trade Area (AfCFTA) Secretariat, World Economic Forum and the Tony Blair Institute aims to build a new digital-trade infrastructure across all 55 African nations, using stablecoins such as USDT for cross-border payments and trade-finance settlement.

If successful, this could sharply reduce the friction, cost and delays that have long plagued intra-African commerce, potentially unlocking billions in regional trade flows.

A recent World Bank Africa’s Pulse report shows that South Sudan and Ethiopia posted the weakest currencies on the continent in the first eight months of 2025, each falling more than 10 percent. In Ethiopia, the foreign exchange liberalization efforts are colliding with persistent parallel-market premiums and limited dollar access.

Against such pressures, dollar-stable digital assets offer households and firms a rare buffer.

African regulators, once hostile to crypto, are beginning to pivot; Ghana became the first West African nation to formally regulate cryptocurrency. Kenya enacted a Virtual Asset Service Providers law to license exchanges and custodians. Other countries are shifting from bans to frameworks designed to balance innovation with monetary stability.

Still, obstacles remain, regulatory uncertainty. Banks’ resistance to crypto integration, and uneven internet and digital-ID infrastructure, limited institutional adoption are yet to be navigated. Banks warn of systemic risks as widespread migration to dollar stable coins could drain local-currency deposits and destabilize fragile banking systems if left unregulated.

The South African Reserve Bank raised concerns about the growing risk posed by digital assets and stablecoins, in its second financial stability report published recently. The number of crypto users in the country has surged, with 7.8 million users on the three most significant crypto exchanges as of July. In the report, the central bank expressed its concern about the potential impact on the country’s financial stability as digital asset use continues to grow.

As of July 2025, South Africa’s three largest crypto exchanges reported a combined 7.8 million users. At the end of 2024, crypto exchanges held approximately 1.5 billion dollars in custody. The increasing popularity of crypto assets has raised alarms at the South African Reserve Bank, which noted that their borderless nature could undermine the country’s regulatory framework. The report revealed the risks posed by crypto assets, such as Bitcoin and Ether, to the financial system. The Reserve Bank warned that digital assets could be used to bypass Exchange Control Regulations.

Despite the risks, experts argue that crypto in Africa is transitioning from speculative asset to functional payments infrastructure. When combined with clear regulation, stablecoin rails could lower trade and remittance costs, improve currency resilience, accelerate financial inclusion and strengthen regional economic integration.

What began as grassroots, retail-driven adoption is now edging toward becoming a structural part of Africa’s financial future.