Why Tether, Circle and Ripple are betting on African fintechs
Global stablecoin issuers are betting on the continent's biggest fintechs to drive distribution.
The biggest signal in African fintech over the past three months has not been another record funding round or a new customer milestone. Instead, it has come from a series of infrastructure deals involving some of the continent’s largest financial technology companies and the world’s biggest stablecoin providers.
Flutterwave, Paga, LemFi, Yellow Card and Sasai have all announced partnerships or investments centred on stablecoin infrastructure. The deals differ in structure but point in the same direction.
LemFi secured a strategic investment from Tether. Ripple invested in Flutterwave’s Series E round. Circle deepened its relationship with Flutterwave via an investment. Paga has announced a stablecoin partnership, while Yellow Card continues expanding its role as one of Africa’s largest institutional stablecoin platforms.
These developments suggest that stablecoin companies are no longer treating Africa as simply another market for digital assets. Instead, they increasingly see the continent’s fintech ecosystem as a distribution network capable of bringing stablecoins into mainstream financial services.
Stablecoins go mainstream
For years, stablecoins were largely associated with cryptocurrency trading. Today, they are becoming settlement infrastructure. Instead of serving speculative markets alone, they are increasingly embedded into cross-border payments, treasury management, merchant settlements and remittances.
Africa is emerging as one of the most attractive markets for that transition. According to Yellow Card, stablecoins account for roughly 43% of cryptocurrency transaction volume in Sub-Saharan Africa. And their appeal has only grown. Stablecoins offer near-instant settlement, continuous availability, lower transaction costs and greater predictability than many traditional cross-border payment channels.
As regulatory clarity improves across major jurisdictions, they are also becoming more acceptable to financial institutions that previously kept their distance from digital assets.
The recent partnerships therefore raise a more interesting question than whether African fintechs are adopting stablecoins. The better question is why some of the world’s largest stablecoin providers are investing in African fintech companies instead of simply selling them infrastructure.
Africa provides an opportunity for scale
Stablecoin issuers such as Tether and Circle have already solved many of the difficult technical challenges surrounding digital dollars. They have built liquidity, established institutional trust, and gradually improved regulatory acceptance. What they’ll always need is distribution.
That explains why the recent announcements have involved some of Africa’s largest fintech operators rather than smaller cryptocurrency startups.
Flutterwave operates across more than 30 African markets and has processed tens of billions of dollars in payment volume since launching. Its extensive licensing footprint, merchant relationships and enterprise customer base provide immediate access to payment corridors that would take years for a foreign infrastructure company to build independently.
Originally focused on remittances for the African diaspora, LemFi has evolved into a broader financial platform offering savings, investment and credit products. For a company like Tether, partnering with LemFi is not simply about one remittance product. It creates a pathway into millions of existing financial relationships.
After nearly two decades of operation, Paga has built one of the country’s largest payment ecosystems. Its transaction volumes, regulatory experience and consumer reach make it an attractive partner for any company seeking meaningful adoption.
In each case, the attraction is similar. Stablecoin providers already possess the digital asset, and African fintechs possess the customers.
Ernest Bosha, a partner at Pulaspace, argues that this reflects where stablecoin adoption is growing fastest.
“The market opportunity itself is huge to own certain remittance and trade corridors like Africa – [Asia Pacific], which have historically been dominated by large international banks such as Standard Chartered, HSBC and Citi, but are now opening up to African fintech operators,” he says.
Unlike the European Union, the continent does not operate with a single currency. Cross-border payments remain fragmented across dozens of national currencies, settlement systems and regulatory frameworks. Every additional intermediary introduces cost, delay and foreign exchange risk.
Stablecoins offer an alternative settlement layer that is independent of those national payment systems. They are unlikely to replace domestic currencies, but they can reduce friction between them. For fintech operators serving businesses that trade across African borders, that proposition becomes increasingly attractive as transaction volumes grow.
The long-term opportunity extends beyond today’s payment flows. Goldman Sachs estimates that Africa’s economy could exceed $38 trillion by 2050. Stablecoin providers are therefore making a strategic bet on future economic activity as much as current transaction volumes. Building relationships with leading fintech companies today creates distribution advantages that may become significantly more valuable over the coming decade.
Partnerships vs investments
If the strategic objective is distribution, another question follows. Why do some stablecoin companies choose to invest in African fintechs while others settle for, at least, initially, commercial partnerships?
Both approaches can lead to product integrations, joint go-to-market strategies and increased transaction volumes. In practice, however, they represent varying levels of commitment.
A partnership is transactional; it allows both parties to test a product, open new payment corridors or integrate a stablecoin into an existing payments stack. The relationship can evolve, expand or even end with relatively little disruption. For fintechs, partnerships also preserve flexibility. They can integrate multiple providers simultaneously and route transactions across different rails depending on pricing, geography or customer needs.
An equity investment, on the other hand, aligns incentives over a much longer period. It may also give the investor visibility into a company’s product roadmap and strategic priorities. While investors do not necessarily dictate commercial decisions, they often gain a closer seat at the table than a standard infrastructure partner.
Ripple’s investment in Flutterwave illustrates that distinction. Beyond participating in the company’s Series E funding round, Ripple’s RLUSD stablecoin became Flutterwave’s default stablecoin option within its payments infrastructure. The investment therefore strengthened Flutterwave’s balance sheet while positioning Ripple closer to the centre of one of Africa’s largest payments networks.
Tether’s investment in LemFi follows similar logic, albeit for a different use case. Remittances remain one of the most compelling commercial applications for stablecoins because they compress settlement times and reduce dependence on traditional correspondent banking networks. LemFi’s growing footprint across Africa, Europe and Asia provides Tether with access to payment corridors that are already generating meaningful transaction volumes.
Every additional transaction settled using USDT or another supported stablecoin reinforces network effects around that asset. Over time, scale becomes a competitive advantage that is increasingly difficult for rival issuers to replicate.
Flutterwave has announced collaborations with Circle, Ripple, Tempo and RD Technologies over a relatively short period. From the outside, that appears crowded, but it isn’t uncommon. Large payment processors rarely depend on a single payment or settlement rail. Instead, they aggregate multiple rails and determine the optimal route depending on the transaction.
Viewed through that lens, Flutterwave is not accumulating redundant partnerships. but expanding the number of payment rails available to its merchants.
Bosha argues that this approach is consistent with Flutterwave’s broader strategy, noting that the fintech has repeatedly stated its ambition to aggregate multiple payment rails and make them available through a single platform.
What does this mean for African crypto startups?
The rise of stablecoin partnerships also raises questions for Africa’s crypto-native companies. Exchanges such as Quidax, Busha, and Yellow Card introduced millions of Africans to digital assets. In many ways, they laid the foundations for today’s stablecoin economy.
Yet, the market they helped create is beginning to change. The first wave of cryptocurrency adoption in Africa revolved around ownership. Consumers bought Bitcoin, Ether or USDT through exchanges and held those assets in wallets. The next phase appears focused on utility rather than ownership. Stablecoins are becoming embedded inside payment products, remittance services and treasury solutions where users may never realise they are interacting with blockchain infrastructure.
If a customer sends money through LemFi or a merchant receives settlement through Flutterwave, the stablecoin functions as invisible infrastructure rather than a retail investment product. The customer does not need to visit an exchange or actively purchase USDT. The fintech manages those processes in the background.
For crypto exchanges, that could represent both a challenge and an opportunity.
Bosha believes the most immediate pressure will fall on the on-ramp business that many exchanges have relied upon for years. However, he notes that this does not necessarily imply decline for local exchanges.
Many crypto-native companies possess capabilities that traditional fintech operators are still developing. They understand blockchain infrastructure, maintain deep liquidity relationships and have spent years building compliance programs specifically for digital assets. As stablecoin volumes continue to grow, those capabilities could become increasingly valuable.
In Nigeria, for example, the country’s Securities and Exchange Commission (SEC) has accelerated its digital asset licensing framework, providing compliant operators with greater regulatory certainty than was available only a few years ago. But even then, it is not issuing licences rapidly. Exchanges that secure licences and invest in institutional-grade compliance may find themselves well positioned to serve banks, payment companies and multinational businesses seeking regulated access to stablecoin liquidity.
Rather than competing directly with fintech platforms, they could become infrastructure providers to them.
Furthermore, stablecoins’ growing appeal only means more businesses will increasingly require liquidity management, treasury services, custody, compliance tooling and foreign exchange optimisation. Someone must provide those capabilities, and crypto-native firms already possess much of the expertise required to build them.
“They have to evolve into building more crypto-native products,” Bosha argues, adding that some will become liquidity providers while others will solve the infrastructure problems that emerge.
The winners, he believes, will share three characteristics. First, they will have strong regulatory compliance. Large corporates, banks and institutional investors will easily get into business with counterparties that possess robust governance, licensing and risk controls.
Second, successful operators will avoid dependence on a single payment rail. Platforms capable of routing transactions across diverse rails will enjoy greater resilience and pricing power.
Finally, the greatest opportunity may lie in solving the last-mile problem. Sending a stablecoin across a blockchain is no longer particularly difficult. Embedding that stablecoin into payroll, merchant payments, trade finance or consumer spending remains considerably harder. Companies that simplify those everyday use cases are likely to capture more long-term value than those focused solely on issuance.
