A Quiet Revolution in Africa’s Financial Landscape

Africa’s financial landscape is experiencing a quiet revolution and a significant shift from speculative cryptocurrency trading to utility-driven adoption, with over-the-counter (OTC) crypto emerging as a transformative force for African businesses.

Obinna Iwuno, President of the Stakeholders in Blockchain Technology Association of Nigeria (SiBAN), posited this during a webinar organized by Techcabal in collaboration with Quidax, with the theme: ‘The Quiet Revolution: Is OTC the Future of African Business Payments?’

Regulatory Interest as a Key Driver

According to Obinna, a key factor driving this change is the government and regulatory interest, which has yielded to the increase in the usage and adoption of cryptocurrencies and digital assets.

He argued that this realization has prompted a shift toward a more constructive regulatory approach. Nigeria, for example, has taken a significant step forward with a regulatory innovation programme to build a digital asset operations framework and issue provisional licenses to operators.

This aligns with global trends seen in the EU and Singapore, as well as the recent digital assets legislation in the United States. Furthermore, governments are beginning to view crypto as a new revenue stream, with the potential to generate taxes, attract economic development, and provide a legal framework for the industry.

The Market Need for OTC Crypto Trading

Obinna explained that the rise of OTC crypto trading is a direct response to a market need, particularly for businesses and high-net-worth individuals, insisting that OTC desks facilitate large-volume trades that, if executed on a traditional centralized exchange, could cause a frenzy in the markets.

Historically used by large-scale investors, OTC services are now being adopted by businesses for purposes like payments and settlements, ensuring market stability. This method allows for large trades with minimal slippage and real-time fiat settlement across various markets.

The Stablecoin Advantage

The increasing use of stablecoins is at the core of this trend. Businesses are adopting them for their ability to provide instant settlements, lower transaction costs often under 1%, and easy accessibility to the unbanked population.

According to the SiBAN President, the high mobile penetration rate in Africa, combined with the security and efficiency of blockchain technology, makes stablecoins a viable alternative to traditional financial systems.

The speed and lower cost are especially compelling for cross-border payments, where traditional banking can take days to settle and incur fees as high as 8%.

Regulation as a Confidence Booster

Obinna also emphasized the role of a clear regulatory framework in building confidence. He cited Nigeria’s Securities and Exchange Commission (SEC) licensing as a confidence signal that rippled across the continent.

This move, he said, indicates to global businesses that Africa is prepared for crypto settlement, attracting further investment and growth. This is further evidenced by similar licensing movements in countries like South Africa.

The growth is substantial, with Nigeria alone having processed approximately $59 billion in crypto value since the previous year, ranking it second globally after India.

A New Era for African Business

This shift, driven by a combination of global trends, regulatory evolution, and the practical utility of stablecoins and OTC services, highlights a new era for African business.

The continent is moving toward a more efficient, accessible, and regulated digital financial ecosystem.