Nigeria has emerged as the second-largest adopter of crypto worldwide, cementing its position as a leader in digital finance, according to Chainalysis’ upcoming report.

The ranking illustrates Nigeria’s rapidly expanding crypto ecosystem, where everyday transactions, remittances, and business payments increasingly rely on digital assets, especially stablecoins. The country’s success mirrors a broader trend in Sub-Saharan Africa, a region witnessing modest yet significant growth in its crypto adoption.

According to Chainalysis, Sub-Saharan Africa’s burgeoning crypto economy, driven by the need for alternative financial services and more accessible international markets, is positioning the region as a growing hub for innovation and financial inclusion on the global stage.

Steady growth across Sub-Saharan Africa

Despite representing only 2.7% of global transaction volume, Sub-Saharan Africa received $125 billion in on-chain value between July 2023 and June 2024, marking a $7.5 billion increase compared to the previous year.

While the region’s contribution to the global crypto economy remains small, its influence is growing as several African nations emerge as key players in the crypto space. Other African nations, including Ethiopia, Kenya, and South Africa, have all secured spots in the top 30 on the Chainalysis Global Adoption Index.

Moyo Sodipo, COO and co-founder of Nigerian crypto exchange Busha, said:

“Nigeria’s high adoption rates show how practical crypto has become for everyday transactions.”

Sodipo noted that many Nigerians are turning to crypto for bill payments, mobile credit top-ups, and cross-border transfers as the traditional financial system struggles with inflation and currency devaluation.

The report also highlighted Sub-Saharan Africa’s leadership in DeFi adoption. DeFi platforms allow users to access financial services, such as lending and borrowing, without needing traditional banks, which remain out of reach for many.

The World Bank estimates that only 49% of adults in the region had access to a bank account as of 2021, making crypto an attractive alternative for millions.

Stablecoins drive economic stability

Stablecoins are pivotal in Sub-Saharan Africa’s crypto economy, with Chainalysis estimating that they account for 43% of the region’s total crypto transactions. These dollar-pegged digital currencies have gained significant traction in countries where local currencies are volatile and access to US dollars is limited.

In Nigeria, businesses and individuals increasingly rely on stablecoins like USDT and USDC to protect their assets from the local fiat currency’s ongoing devaluation. The country’s foreign exchange shortage has further intensified the demand for stablecoins, enabling companies to conduct international trade that would otherwise be hindered by currency shortages.

Chris Maurice, CEO of African crypto exchange Yellow Card, said:

“The banks don’t have dollars, the government doesn’t have dollars, and even if they did, they wouldn’t give them to you.”

He explained that stablecoins serve as a reliable alternative for businesses involved in international trade, from small-scale importers to large multinational corporations.

Ethiopia, the region’s fastest-growing market for stablecoin use, has seen a 180% year-over-year increase in retail-sized stablecoin transfers. This surge follows a 30% devaluation of Ethiopia’s local currency, the birr, as the government relaxed currency restrictions in exchange for a $10.7 billion loan from the IMF and World Bank.

Stablecoins are also revolutionizing cross-border payments across Africa. Remittances, a vital source of income for many African households, have become significantly cheaper and faster using stablecoins compared to traditional fiat currency methods.

In Nigeria alone, stablecoin transactions under $1 million nearly reached $3 billion in early 2024, demonstrating their growing importance for small and medium-sized transfers.

Crypto and financial inclusion

As Nigeria and other Sub-Saharan nations deepen their engagement with crypto, stablecoins are expected to play a central role in stabilizing economies, facilitating international trade, and enabling cross-border payments.

South Africa, with its rapidly growing institutional activity and TradFi integration, stands poised to be another key driver of crypto adoption in the region.

Rob Downes, head of digital assets at Absa Bank in South Africa, said:

“Nigeria and South Africa are leading the way in showing how crypto can drive financial inclusion.”

The post Stablecoins, DeFi boost Nigeria to second in global crypto adoption rankings – Chainalysis appeared first on CryptoSlate.

Telegram founder Pavel Durov has disclosed that the social media platform has always collaborated with law enforcement agencies, even revealing the IP addresses of criminals to authorities as far back as 2018.

Durov’s comments follow recent changes to the platform privacy policy and terms of service, which were made to assuage concerns from law enforcement authorities about the social media app. The changes include introducing moderators using artificial intelligence to hide problematic content from Telegram Search.

However, the key change that attracted attention was the update that Telegram can reveal IP addresses and phone numbers of those violating content restrictions rules to law enforcement agencies.

This update has attracted attention from observers who question whether it could lead to Telegram disclosing information about users to repressive governments, given that the platform is popular among dissidents and activists.

Durov says Telegram remains committed to free speech

However, Durov has clarified the updates, noting that it is not a major change as the platform has always complied with content moderation standards and cooperated with law enforcement authorities.

He said:

“Since 2018, Telegram has been able to disclose IP addresses/phone numbers of criminals to authorities, according to our Privacy Policy in most countries.”

Durov further explained the process, noting that Telegram always processed legal requests from authorities and disclosed information such as criminals’ IP addresses and phone numbers. He gave examples of India and Brazil, where the company processed almost 7,000 and 203 legal requests, respectively, in the first three quarters of 2024.

The CEO added that the new updates simply streamline and unify its privacy policy in several countries and do not affect its core principles.

He added:

“Our core principles haven’t changed. We’ve always strived to comply with relevant local laws — as long as they didn’t go against our values of freedom and privacy.”

Meanwhile, Durov noted that Telegram saw more valid legal requests from  European law enforcement in Q3 of 2024 because they are all now using the contact point as mandated by the EU Digital Services Act.

Will Telegram updates address regulatory concerns?

Today’s post will clarify the concerns of many who are now wondering how the new privacy policy would affect Telegram operations and its pro-privacy and censorship-resistance stance. As the CEO noted, its features were meant to protect activists and ordinary people, not to be abused by criminals.

However, another question is whether these changes would be enough to address law enforcement concerns. The platform has been under regulatory scrutiny for being a haven for several illicit activities, leading to the arrest of its Durov in France a few weeks ago.

Although Durov criticized the arrest and criminal charges against him as misguided, the changes suggest Telegram remains committed to regulatory compliance. Still, experts are undecided on whether the changes would be enough to satisfy law enforcement authorities who are scrutinizing its content moderation standards.

According to Daphne Keller at Stanford University’s Center for Internet and Society, concealing problematic content from search or making it more difficult to find might not satisfy the content moderately—standards under European or French laws.

She noted that the general rule is for social media platforms to remove such illegal content instead of just hiding it from search. In some cases, such as child pornography, the platform is even obligated to report such content to the authorities after removal.