<\/p>\n
You can also listen to this podcast on iono.fm here.<\/p>\n
While US dollar-pegged stablecoins are all over the news, a quieter trend is emerging across Africa: the development of stablecoins tied to local currencies.<\/p>\n
These stablecoins promise to expand financial inclusion, reduce dollar dependency, and enable more efficient domestic and cross-border payments.<\/p>\n
Listen\/read:
Will stablecoins one day rule the world?
The stablecoin gold rush is here
How to dollarise your life with stablecoins<\/p>\n
We\u2019ve seen a batch of ZAR stablecoins launched in recent months, among them Zaru, backed by Luno and Sanlam; ZARP, backed by Old Mutual; and ZAR Supercoin, issued by gaming company Super Group, as well as the oldest of them all, xZAR, issued by crypto exchange AltCoinTrader.<\/p>\n
Listen\/read:
Absa\u2019s bold leap into stablecoins
Africa\u2019s next payments leap: Stablecoins on every corner
New rand-backed stablecoin launched<\/p>\n
The idea that central bank digital currencies (CBDCs) will earn the trust and support of the public is misplaced, says Hannes Wessels, general manager for Binance South Arica, in this episode of Moneyweb\u2019s\u00a0Crypto Pod. What\u2019s far more likely to succeed are private monies like stablecoins.<\/p>\n
\u201cI think there\u2019s been too much kickback against CBDCs,\u201d says Wessels.<\/p>\n
\u201cYou need to see South Africa for what it is. We are a liberal democracy. People don\u2019t want this overbearing centralised approach of the CBDC.<\/p>\n
\u201cWith a lot of respect, we\u2019ve seen this fail in Nigeria, where a CBDC was attempted. It didn\u2019t work. People go towards the lowest-friction option that they trust the most. And this is simply the blockchain, [which] tells you the truth. People go to where they find those two things, trust and efficiency \u2013 and stablecoins provide that.<\/p>\n
\u201cSo rather than fight the system, I would enable the system, I would monitor the system, I would regulate the system, but I wouldn\u2019t try to dominate it,\u201d he says.<\/p>\n
\u201cI think those days of a central government currency coming from a central bank [are coming to an end] \u2013 I think we\u2019re moving towards an age of decentralisation as we move towards an age of instant payments.<\/p>\n
\u201cAnd think that\u2019s the way to go. Let the private guys run it, but monitor and regulate it.\u201d<\/p>\n
Technology is streaking ahead of regulators\u2019 ability to stay abreast, so the market will reward those jurisdictions that encourage innovation and move fast to regulate these new forms of money without stifling it.<\/p>\n
How will stablecoins gain acceptance?<\/p>\n
Just as SA was a global leader in shifting bank customers to ATM cash dispensers in the 1980s, it could once again lead the way \u2013 this time by driving the adoption of stablecoins that enable instant 24\/7 payments beyond traditional banking hours.<\/p>\n
\u201cThe real adoption of this is driven not at retail level, because it\u2019s relatively easy for a retail individual like you and I to get onto a [platform like] Binance and open both your account and a wallet,\u201d says Wessels.<\/p>\n
\u201cAnd I think both are important because one is centralised, you get the liquidity pool, the other one [the wallet] is for custody purposes.<\/p>\n
\u201cYou take that further, you look how quickly stablecoins found a function in Africa, faster than any other cryptocurrencies at scale.<\/p>\n
\u201cBut then the adoption lies at merchant level.\u00a0You\u2019ve got to have a place to spend this.<\/p>\n
\u201cOtherwise, if you just have a stablecoin, but you now still need to go turn it into a kwacha or something in order to spend it at a local retailer, that\u2019s where it fails. And that\u2019s where a lot of our efforts are,\u201d says Wessels.<\/p>\n
Listen\/read:
Stablecoins are gaining ground as digital currency in Africa
Don\u2019t put your head in the sand: Stablecoin adoption is not going away<\/p>\n
The beauty of the blockchain is that it allows for full transparency, which is a dream for regulators. The monitoring framework is already in place, so long as the wallet owners are known and identified.<\/p>\n
\u201cFor me, this is something I think regulators should jump on very quickly because it\u2019s going to make their lives easier,\u201d says Wessels.<\/p>\n
The launch of PayShap by the South African Reserve Bank, PayInc and the Payments Association of SA was a major improvement on traditional banking transfers.<\/p>\n
However, stablecoins go a step further, offering near-instant settlement, 24\/7 availability beyond banking hours, and lower costs \u2013 particularly for cross-border transactions.<\/p>\n
Who would want a ZAR stablecoin outside of SA?<\/p>\n
The real benefits are yet to come, as more assets become tokenised and transacted in stablecoins.<\/p>\n
There are also opportunities to covert from ZAR to stablecoins pegged to other currencies. This is a major advance on the current system where the ZAR has little utility outside SA.<\/p>\n
Listen\/read:<\/p>\n
Why SA needs stablecoin regulations \u2013 and fast
\nSA (and Sars) on board with global crypto reporting initiative<\/p>\n
\u201c[Stablecoins] solve a lot of issues for the supply chain, specifically the retailer. Because if you think about your working capital velocity, that accelerates immediately because you can immediately change this into whatever you need,\u201d says Wessels.<\/p>\n
\u201cAnd that\u2019s the bit that we say to people, there is a real benefit.<\/p>\n
\u201cWe\u2019re not saying move lock, stock and barrel to stablecoins, but allocate a bit of your working capital cycle, your accounts, everything to that.\u201d<\/p>\n
He adds: \u201cGive it a spin, because over time \u2013 and I know this is a bold prediction, but I still think it will happen over time \u2013 everything will become tokenised or substantially tokenised. And the earlier you are on this, you can get a competitive advantage for your business.\u201d<\/p>\n
For previous Moneyweb Crypto Pod episodes,\u00a0click\u00a0here.<\/p>\n
You can also sign up for our\u00a0crypto newsletter.<\/p>\n
#moving #age #decentralised #money<\/p>\n","protected":false},"excerpt":{"rendered":"
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