Globally, stablecoins have proven to be the darling of crypto and blockchain, providing users with the opportunity to transact outside the limits of traditional financial systems. The appeal of stablecoins can be seen in recent data which shows that in 2022, over $7 trillion worth of transactions were made through stablecoins, exceeding the volume of transactions on all major card networks except, VISA, which processes 12 trillion yearly transactions. Due to the growing global acceptance of stablecoins, fintechs globally and on the continent are using stablecoins for payment in one way or another.

Stablecoins, such as the USD Coin (USDC), Tether (USDT) and the Binance USD (BUSD), are a form of cryptocurrency whose values are typically tied or pegged to a fiat currency or gold, usually, the US dollar, to stabilize its price. Due to their stability in value, stablecoins serve as an alternative to other volatile cryptocurrencies like Bitcoin and Ether, which raise value fluctuation concerns when used for payments.

Even for global card payment giant Visa, the growing interest in stablecoins is hard to ignore. Earlier this month, it announced that it would pay merchants with USDC, the second-largest stablecoin by market capitalization. Thanks to a partnership with Circle, USDC’s issuer, Visa will send out USDC to two other large payment companies, Worldpay and Nuvei, who will then remit fiat to the merchants. A process that’s customarily done with fiat. Although, Visa’s head of crypto, Cuy Sheffield told Fortune that processing time using stablecoins and fiat are the same, it’s evident that the payment giant doesn’t want to be left out in the increasing use of stablecoins in the world even if it’s not entirely disruptive for it at the moment. But Visa is not the only legacy payment firm that has recently forayed into stablecoins. Back in August, PayPal partnered with Paxos, a stablecoin issuer, to launch its stablecoin.

Likewise, stablecoins are also popular in Africa, but, here, they are seen as majorly an efficient way to make payments. Stablecoin’s appeal on the continent revolves around facilitating low transaction fees; providing the ability to send money across jurisdictions for commercial trade, shoring up USD liquidity, and hedging against devalued currencies.

Crypto companies are jumping on the stablecoins parade

In an interview with BloombergTV in July, Chris Maurice, CEO and founder of Yellow Card, Africa’s largest cryptocurrency exchange said that stablecoins account for 95% of transaction volumes on its exchange. To tap into this growing appetite for stablecoins on the continent, Yellow Card has partnered with Circle, issuers of USDC and Tether, issuers of USDT to increase the adoption of stablecoins through educational campaigns.

Nairobi-based Kotani Pay raised a $2 million pre-seed from investors to make cross-border remittances easier for the large underbanked populations in Africa. And it's doing this with none other than stablecoins. What’s more? By using stablecoins, which drastically reduces complexity, it allows families with low-cost and non-internet-enabled feature phones to use another simple communication protocol, Unstructured Supplementary Service Data (USSD) to send and receive money from their loved ones around the world, at a fraction of the usual costs.

Accrue, which we featured on NODO last week, is building a borderless stablecoin payment rail where cross-border payments settle in less than five minutes and cost no more than $2. Speaking with NODO for that piece, Accrue’s co-founder and CEO, Clinton Mbah described stablecoins as a potential solution to Africa’s cross-border payment problems. “They're programmable, settle instantly, and offer low fees,” Mbah said.

Nigerian crypto product development firm, Nestcoin’s new product Onboard raised $1.9 million from Adaverse and Coinbase to build a virtual card product that allows users to spend stablecoins across over 160 countries, among other features.

So, it seems like everywhere you turn in African payment this year, there is a growing preference for stablecoin. As long as payment is a hassle for millions of people on the continent, we will keep seeing fintechs placing crypto and specifically stablecoin front and centre of their gameplay.