African firms adopt stablecoins to bypass traditional payment bottlenecks

Before launching Kora, Nsofor managed a hardware business in Nigeria where payments to Chinese manufacturers frequently stalled for up to 14 days. These transactions often withered in the gears of multiple correspondent banks, where a single clerical error could trigger further weeks of uncertainty. Today, he argues that stablecoins provide a necessary dollar-based settlement layer that simplifies the movement of value across borders, allowing firms to bypass the high costs and complexity of traditional currency conversion.

While the technology offers speed, Nsofor emphasizes that it is not a standalone solution. Successful adoption requires robust infrastructure to connect stablecoins with local mobile money networks and traditional bank accounts. A recent study by Banca d’Italia underscored this reality, finding that while stablecoin transfers are efficient, the ultimate cost and speed often depend on the local-currency "on-ramps" and "off-ramps" provided by domestic banking systems. Consequently, Kora focuses on selling these vital connections, helping businesses integrate fiat and digital assets into a single workflow.

Despite the clear utility for trade, Nsofor warns of inherent risks for African markets. Because most stablecoins are backed by foreign dollar reserves and governed by non-African issuers, local businesses remain exposed to regulatory or redemption failures occurring thousands of miles away. He advocates for standardized regional frameworks that would allow compliant payment companies to scale across borders, ensuring that digital assets serve local commercial needs rather than merely creating new dependencies on external actors.