Panel Session VI: How Stablecoins are Powering the New Pan-African Economy.

Good afternoon everybody. My name is Arici Amaratuku also known as Mara Blossom and I'm the moderator for this panel session. It's a pleasure to actually be moderating this important discussion on stable coins and how stable coins are powering the new pan African economy. And um we all know that stable coins have moved from being just a random crypto asset to being the lifeline of remittance treasury solutions and payments across Africa. and I have an incredible panel of speakers, founders, operators, and builders who are building some of the most impactful stable coinbased applications or platforms in Africa.

Um, I'll just give them one minute to introduce themselves and then we'll start.

Okay. Hi everyone. My name is Adola. I um head the marketing team at um CNGN or RAC CBDCN issuing company. I also head investment at Olu Corporation where we were three focused venture arm um and um tell

a round of applause for him please.

Hello everyone my name is Shan and I'm the co-founder of Polabs. were the developers of Hyperbridge which is a decentralized crosschain bridge.

A round of applause please.

Hello everyone, my name is Esa Omina and I'm a community manager and the regional ambassador for Noble. So noble is a purpose-built blockchain for stable coin issuance on Cosmos. So what I mean is that we provide the rail for um for stable coins for regulated and trusted stable coins to actually flow across ecosystems across borders. So that is

uh hi guys uh I'm Israel head of growth at Prest is a decentralized open-source payment routing protocol. It's multi-chain. We help businesses move money across border. Thank you.

Thank you so much. A round of applause for them please. So I'll be starting with you Esa. Please hold your mic. So a lot of remittance corridors in Africa actually remain costly and efficient.

Yeah. So my question is this. In your view, what role can stable coins play in fundamentally reducing this cost across the African continent?

Okay. Thank you very much for the question. So um let me start by saying that in Africa um money doesn't move in theory, it moves in reality. So what I mean is that um taking an instance from the business woman that sells in um what's the name of this market? Baluable market and down to the freelancers that are here.

You see that they offer services online and they get paid online. So this is where stable coins and um noble especially comes into it. So noble being the um blockchain that um a post blockchain that um stable coins are being issued. So you see that noble is built on um ultra low cost speed and interoperability. So what this means is that Noble is um built on the Cosmos um SDK which makes it really modular and fast.

So when you are sending um crypto or stable coins, it is really fast and it is instant. So let's say you are sending either you are sending $1 or $10,000, right? So the the experience feels instant and really really affordable. So and also Noble uses the instant finality which means that the moment you click send transactions are final and they are irreversible. So taking that Noble has already empowered stable coins like USDN, USDC, EU.

So you see that these stable coins they flow seamlessly across borders. So let's say that um someone in Lagos now can now receive dollar instantly from abroad without having to pay like the 10 to um or 8 to 10% remittance fees that are common today. So aside that even let's not even talk about the um USD which is the youthbearing stable coin right. So the fact that it uses that um Cosmos SDK which makes transactions very fast and we know that this is a critical feature when you talk about real money payments in Africa. So being able to send transaction now sending payments to someone and in less than a second they've gotten it.

So I feel like that's um how we can solve that.

Thank you very much. Sorry for interrupting the panel but I was just informed that one of our panelist is available again in person of Kendrick Eabs. Please a round of applause for him as he comes on stage. Thank you so much. So we move on to the next speaker.

Hi Israel. Can you pass the mic? So stable coin platforms like Prest reshaping how remittances work in Africa. So how has Payest reduced remittance cost and settlement delays compared to traditional financial models?

All right. So uh um I I had a talk about uh 30 45 minutes ago and I made mention of something. I said when you see most remittance platform not just remittance platform global money movement platforms uh there are four key things that you judge them by right you look at security you look at speed you look at cost and ease right and most times it's very difficult to see a player uh scoring or playing at 99 percentile across these four key pillars of global money transfer. Now what we did we took down these uh four pillars and we analyzed it. Now when you look at cost even if you are moving money through stable coins at the end of the day when you when you want to offramp to a fiat that money is still going to there's still going to be a last mile payout and that is where most of the cost comes in because you're probably going to be using a PSP right to off to fiat to go to the maybe your grandmother in the village.

Now what we do at Press is that we integrate with the lowest possible um PSP. So for example, we all know Flutterwave charge 1.4% plus another fee. Integrating with Flutterwave means um our sender businesses will have a higher rate. Do you get?

So what we do is that we focus on integrating with the lowest the micro finance bank in Ghana, the micro finance bank in Kenya, right? and focus on the mainstream banks, deposit money banks if we can get partnership with UBA that they are to be the lowest so that at the end of the day when you look at the supply chain of the money when it moves from um after the offramping when it moves to the final person you study as the money is you study how the money moves you make sure that we make sure that integration happens so that the sender business after topping up his own fee is still able to have a decent rate. So we were very intentional about our architecture to make sure that people that build on Payest are able to have a healthy rate to present to their users by that integration.

Thank you so much. You mentioned something about PSP. What's that?

Payment service providers.

Oh, okay. Thank you so much for that.

Thank you,

Kendrick. Thank you so much for joining us. Um,

thank you.

Right. So as a Nigerian founder building an African stable a stable coinbased platform right building for Nigeria is often the starting point but Africa is actually vast and diverse right now. How do you approach scaling into less served African markets while still serving your Nigerian base?

Uh good afternoon everybody. Uh my name is Kendrick and I'm building. So let me quickly introduce EALabs before I answer your question.

Go ahead.

So ifabs is a multi-chain oracle infrastructure for stable coins basically, right? So look at it like um uh a chain link for stable coins in emerging markets, right? So the uh the the initial problem the critical gap that we saw in the system was that most of these emerging stable coins they uh uh they do not have uh price data right uh and you know when you go to chain link for instance you want to uh have your own price feed on chain link there are certain requirements from chain link and you know it runs into uh uh for instance $5 million in volume, transacted volume for your emerging stable coin. So you that are just I like to make reference to CGN for instance. CGN is emerging and you're asking CGN to you know uh process $5 million a day in transaction for it to you know have its own feed on chain link.

That's almost impossible right? So uh what our service is doing is we're trying to like fill this gap and you know uh provide data for stable coins in emerging markets. So it cuts across CNG, ZRP, BRZ, you know, emerging stable co uh emerging stable coins basically. Uh please could you run over the question again? I asked um how do you approach scaling into less served African markets while still serving your Nigerian base

uh products?

Yes.

Okay. Uh so uh there's this saying that uh when you are building you build locally before you scale globally, right? Um over the years one thing I realized about you know the typical Nigerian economy is uh the larger percentage of the population they are still in the dark they don't know what crypto is and you know for the few percentage of people that know what crypto is they only know that crypto what they know about crypto is oh I just want to put put my money and when it goes up take out the money, right? Most people are not harnessing the power of crypto like the power of the blockchain, real world utility, what you can do with it. So often time uh I love to go with the approach of education.

Yeah. Because um uh uh uh you know most of the blockchain products they are relatively new and if you're building for the people you have to meet your customers where they are. You don't expect your customers to come meet you where you are, right? So you I often advise people to sort of like incorporate uh uh you know education into your product. So educate these people.

So once you have that figured out, once you've successfully catered for the uh local audience, the the typical Nigerians in this case, you can then now consider killing globally.

Thank you so much for that. So over to you Sheron. Now regulators often remain cautious and stable coins about stable coins cryptocurrency in general especially here in Nigeria, right? So should African governments embrace them as tools for financial inclusion or are regulators right to be to or are regulators right to take a guarded approach? I think stable coins are going to take over finance whether or not regulators like this and they are already taking over finance right like we're seeing chain analysis report that over likeund and something billion dollars of transaction volume in stable coins can be attributed to subsahara and Africa and you have to understand that the government has taken an anti-crypto stance for the past three years so their efforts are clearly not working right so I think the question and a lot of people talk about this that oh no crypto should uh espouse and crypto should seduce the regulatory framework.

No, I don't think so. I think the regulatory framework has to understand how they can continue to be relevant in this new crypto era, right? Um and so, you know, we build at Polabs, we're building infrastructure for stable coins to allow stable coins to be available across multiple different networks. I believe that this gives people who hold these stable coins greater freedom so that they're not necessarily locked into a single network. And this is essentially why people they adopt stable coins, right?

Because they want that freedom. They want that freedom from the existing financial systems that limit you to what a $100 in in you know foreign transaction volume per day or they just close your account if they feel like I mean I recently sent money to my alert account. I haven't used it in a while. I sent like what 200k and they blocked it. They blocked it.

They said I need to come to the bank and come and tell them where I got this money from. It's ridiculous. Um and so this is why people are using stable coins, right? You you receive money on chain. You don't owe anyone any explanation.

You do whatever you want. Your business is unconstrained. Um and I believe that the tools that we are building locally, CNGN being one of them, Payest being another one of them are going to really supercharge uh people's financial abilities to be able to trade and do business with the rest of the world.

Thank you so much for that. I love what you said about giving freedom and power to people. Yeah. So to you Adola right now global stable coins like USDT and USDC are actually dominating the market but CNGN actually brings a locally regulated naira back narrative which is actually new. So what does CGN offer that global stable coins don't especially for Nigerians and Africans?

All right, thank you. Um, I would answer your question, but I would want to contribute to Shon's response. I think disclaimer, disclaimer, I'm not an APC supporter because that's what you would think, right?

Um, but I think we don't give enough credit to this government like we should and credit to guys like Siban and the work that they are doing because it takes a lot of advocacy. Stable coins are being used in Nigeria for payments. So if you use pamp I don't want to name drop anymore but intracountry payments switch and processing is being used by stable by stable coins. Um this you all know the zone network zone network uses stable coins to process transfers. So if you use bail bank, does anyone use bailbank here?

If you use bailbank, all of those transactions are processed by stable coin. It's just not CNG and their stable coin is just not popular. Right? So I think we do not give enough credit to this government. It's slow, right?

The progress is very slow. Uh not very visible, but it's better than the last one. Right? Now back to your question. Um we we've got a lot of criticisms at CGN over the last one month.

And I say that those criticisms are out of ignorance a lot of times, but people are allowed to be ignorant. Uh they say stuff like and very stupid stuff like oh we have we have USDC we have real CGN and I'm like you can see stable coins two different ways, right? Stable coins are a store of value, right? So because most of us receive our grants in USDC and USDT, we tend to see stable coins like a store of value. Yes, it is a store of value.

But stable coins on the other hand are the fastest financial real in the world. Right? So things like transfers, crossber remittance, no one beats stable coins at being a financial rail. Right? So we're trying to position stable coins as a financial real, not as a store of value.

So it's okay if you don't want to hold CGN because of because we inherit the problem of the Naira and we cannot do anything about it. Right? It's okay for you not to hold CGN. But for you to now start to down talk CGN and FUD CNGN because of microeconomic functions that's just plain right CGN works as a financial rail we power transactions in intracountry or intercountry and across countries right so you cannot throw away baby with the bathtub just because you cannot see the underlying function that it brings you see what I'm saying

thank you so much for that a round of applause for him please so for the for the sake of time I'm actually going to be Um taking the last general question now just like Shon said um regulations stable coins are actually gaining traction very fast now in 5 years do you believe that Africans will hold more value in stable coins than in lo than in local banks and if yes what does that mean for the future of African banking let's start with you Adola

do I believe that sorry can you

do you believe that Africans will hold or value in stable coins.

I do not know but what I know is that in 10 years every country in the world will have its own stable coin. What I know is that in 10 years in 10 years countries will start to trade with each other more in stable coins than in fiat currencies. Right? So it means that whether you like it or not you would use a stable coin. At the end of the day, stable coins would be used at the background more than being held.

Right? So most of you are going to use stable coins without knowing that you're using stable coins, right? So in 10 years in traffic and trade will get easier and we love that our guys at Interstellar and PAPs are already powering this with their pop system where you can send money right now from a bank in Nigeria to a bank in Ghana and a lot of these things are going to run you know stable coins. So all the all the African countries in 10 years I can foresee will have a stable coin. We are talking to a couple of central banks across Africa and everyone is willing to I mean US took the lead right so once US moves everyone wants to move so it's going to happen.

We are saying we're going to have a Kenyan stable coin very soon.

There's actually two Kenyan sh stable coins right now.

Interesting.

No, I'm just going to ree what Adola said and yes for sure it's inevitable that all currencies will be tokenized you know to some extent. um how they're used is entirely up to the people who who are using them, right? Like it's entirely up to the countries where they're adopted. I would actually make a more bolder statement, which is that we're most likely going to see a significant percentage of every country's money supply tokenized than the actual fiat supply. Right?

So, I mean, let's look at some fundamental facts. You have money in your bank, right? A lot of us here had, you know, Naira accounts and we all saw what happened, right? Like we all lost access to Mastercard, Visa, and now we could only make transactions locally. Maybe they brought that back.

I don't know what happened there, but in that meantime, imagine if you had a business that relied on you being able to make payments abroad. Okay, I need some, you know, the government's always saying, "Oh, we want to vitalize like manufacturing, but you can't have everything that you need for manufacturing locally, right? You have to import stuff." This is a this is a good lesson from the trade war earlier in this year. No one is an island.

You need to import stuff. You need to import raw material. You need to import machinery. Whatever the case may be. Now you no longer have access to that because what the government decided that you maybe you guys should stay poor or something.

Um but with stable coins, people are able to make trade internationally, right? They're able to settle and receive funds. And imagine if we didn't have that. Imagine if crypto didn't exist. our GDP would be way less than it currently is.

So stable coin adoption is only going to go up. Stable the tokenization percentage of every country's currency is also only going to go up. I think people are going to lose faith in banks. So to completely answer your question, what does that mean for banks? I think banks are going to take a step back and stable coin issuers actually become the new banks.

So maybe banks are only providing credit facilities. You know, I guess that's what they've always done. Uh but when it comes to like actual you know holding of money and transaction of money blockchains and stable coins in combination become the new banking infrastructure because of that permissionlessness because of that like ownership that it really gives you and also it just yeah it just makes life much easier. I mean I'm sure you all understand what I'm talking about.

Thank you so much for that. Okay, for me I might not say that um 5 years is the time but what I know is that it has already started and it's not even something we can fight and every day you see that the adoption is taking place small small small small I remember a day someone was like Zara I sell this come and buy from me I was like I don't have that I don't have naira she like I take you as it I was shocked and I thought it was a joke she sent wallet address right and now she had to force me to buy what I didn't want to buy. Right?

You already said you don't have that.

So, it has already started, right? And I feel like it's it's not something to fight. It's not competition. It's just about collaboration. They're not here to replace um our traditional monetary system.

They are just here to strengthen it. They will strengthen trade. They're going to strengthen um onchain savings too. Cuz take for instance when I got to know about USD and that's the novel dollar, right? So I got to understand that I deposit money as USDC with hope that they helping me to fight inflation right but then um SEO decides to carry this USDC and invest this in treasury bond right and now they make 5% on my money me I'm happy that they giving me stability but they making money from me too now noble now flips it by pushing this yield back to the users So you are holding USDN and they are giving you yield for holding USDN.

So you are providing stability for me. You're also giving me money too, right? So that is why it's called the dollar that pays you for holding it. So the fact that I'm holding USDA, you're also empowering me. So my money is also working for me while I'm still saving in um dollar.

So I feel like what they have to do is simply to just come together and collaborate. and noble is already building the infrastructure where um institutions, governments can come and build on that infrastructure they are building. So you can decide to issue um naira stable coins like um CFA backed um stable coins alongside the dollar stable coins. So they can actually coexist. Okay.

So it's not um something to fight about. It will take place, right? So like you said, whether we want it or not to happen.

Thank you. All right. Uh great question. Uh I think let me go like this. I think that of course we will have more um usability.

Now let me let me use gold to explain uh what I want to say. So uh back in the days gold has always been used uh to hold value right to hold value right. So I think after World War II most central banks started using like a good amount of their foreign reserves they were keeping it in gold and any time you get to experience inflation countries they buy more gold you know for stability. So gold has always been seen as what is used to you know provide stability but with little local usability. Now part of that part of the reason for that is because gold is a physical commodity right um for you to use it to exchange you might need to be carrying it.

Now why I think stable coin is going to have more adoption is because stable coin can play both roles uh that it can still hold value because of its stability. you know, we already have um I believe people we're going to have more uh uh countries backing up part of their reserves in stable coins uh in the coming years. Uh but at the same time, we can also have that local usability which is already happening. Uh you know, I think we'll have more of that in the next five years. We should have that's the only explanation I can give.

I may not be able to say, oh, it will be this much, but I'm sure it will go very high.

Thank you. And then

so uh I cannot outrightly say that uh in five years for sure but one thing out is u the adoption is growing real quick right and um um so mathematics take for instance If you are traveling to Kenya today, you have to change your naira to dollar, right? And when you get to Kenya, you have to change your dollar to Kenya shillings, right? And averely for every of those conversion, it takes it costs between uh $5 to $10 to do every of those conversion, right? So one of the very good thing about stable coin and what I feel is going to propel this adoption is the fact that is cheaper you know when you are doing transactions with stable coins is cheaper is faster those two things they they the you know the most unique things about stable coins and these are the things that will drive adoptions right many people want to send money people in diaspora they want to send money to their people back here at home and you Although there are some web two platforms that are facilitating this they are making it but you know at the end of the day still stable coin will still be cheaper. Uh I like what Payest is doing right now.

If you you uh Payest has CGN it has Kenya shilling. So if you're traveling to Kenya for instance you can easily use uh Payest to off your money and you know it's way cheaper. And uh shout out to infrastructures like uh block radar uh uh layer 2 blockchain like b that is facilitating the adoption of local stable coins in emerging markets uh eer labs as well that's what's one of the problems we're solving providing data price data for local stable coins in emerging markets because uh you know currently on base we have CGN we have Mexican stable coin, you have uh uh Indonesia. Uh you know what this is saying in essence is if I want to send money to Indonesia for instance, I don't have to go through the USD corridor, I can easily do it on chain, which is faster and it's cheaper. It saves me a whole lot of headache.

So uh uh to butress everything I've said, sooner or later it's going to explode.

Thank you so much. A round of applause for our speakers. Can we take one question?

All right. Thank you so much everyone for listening and um can we take pictures please? Yeah.