Kenya has published new Virtual Asset Service Provider regulations giving its central bank broad authority over digital currency transactions, including the power to restrict access to foreign-issued stablecoins such as USDT and USDC, according to a report by Forbes Africa. Under the new rules, any stablecoin must be approved by the central bank and issued by a licensed entity before it can be listed on a regulated exchange in the country. South Africa released its own draft guidelines for cross-border cryptocurrency payments earlier in August, suggesting a broader regional push to bring digital assets under tighter regulatory control.
Dollar-denominated stablecoins dominate the global market, processing roughly 96 to 98 percent of the approximately $33 trillion in total stablecoin transfer volume recorded in 2025. A separate IMF report on stablecoins in Nigeria had already raised concerns about the capital flow management and financial stability risks these instruments pose for African economies with less developed currency markets.
Former Block executive and Meld co-founder Pankaj Bengani warned that the value of stablecoins comes largely from their network effects, and that overregulation risks creating a more fragmented market with higher costs for cross-border payments. The core tension regulators are navigating, he argued, is between protecting monetary sovereignty and cutting local businesses off from the deep global liquidity pools that dollar-backed stablecoins currently provide.