Last week, at an event hosted by the Virtual Asset Chamber of Commerce (VACC) to discuss the evolving crypto and digital asset landscape in Kenya, there was discussion on the role that over-the-counter (OTC) crypto trading and stablecoins are playing in addressing real economic challenges for businesses and individuals across Africa.
The foreign currency shortage in countries like Kenya forced businesses to find alternative methods of transacting internationally. As Tony Olendo, Chairman of VACC, noted, government debt obligations are often prioritized by banks over private businesses, especially SMEs, for access to scarce USD. This means that midsize enterprises and even exporters and importers are often left with no access to foreign currency from their banks.
In such situations, many have turned to stablecoins. These are digital assets pegged to fiat currencies like the US dollar. Businesses are able to bypass local liquidity issues and access global suppliers directly by shifting to stablecoins. A business can purchase stablecoins locally and use them to pay suppliers in foreign countries such as China, Dubai, or Korea.
Freelancers and the Gig Economy
Besides businesses, those working in digital fields like software development and online marketing are increasingly relying on crypto for payments. Some of the well-known platforms, like PayPal, can limit or even close your accounts. On the other hand, services like M-PESA are not globally accessible. To receive payments from clients many freelancers now use platforms like Binance to receive stablecoins like USDT.
The crypto is then be converted into local currency which is used for everyday expenses.
Remittances and Payroll
Sending money across African borders via traditional channels can cost anywhere between 8 -16% in fees. On the other hand, sending stablecoins can lower the cost to 0.4%. This makes crypto an appealing option for pan-African businesses with teams in different countries with different currencies.
Understanding OTC Trading
OTC trading refers to crypto transactions that are conducted off the main exchanges. This is often through private deals via voice, WhatsApp or Telegram. Think of a situation where you have crypto and know someone who needs them, you can just send them the crypto and they send you the money. This model is beneficial in Africa where formal exchanges are limited and local regulations may restrict open trading. The decentralized nature of OTC has allowed markets like Nigeria to thrive despite government crackdowns. This crackdown pushed the activity into private messaging channels but did not stop it.
Some African governments, like Nigeria, have tried to ban or heavily regulate stablecoins. Others, including Kenya have taken a more measured approach. This was done to avoid driving the industry underground where it becomes harder to monitor or tax. The current legislative efforts around the Virtual Asset Service Providers (VASP) bill show this intent to create a controlled environment for digital assets.
The event also emphasised the role of Bitcoin in creating a decentralized financial network that is free from intermediaries. Bitcoin’s fixed supply of 21 million tokens and decentralized consensus model make it a unique and deflationary asset.
The Role of Platforms like HoneyCoin
Platforms like HoneyCoin help to bridge the gap between fiat and digital assets. They make it easier for individuals and businesses to hold multiple currencies. It also allows them to move between fiat and stablecoins seamlessly, and make cross-border payments with ease. A demo during the session showed how quickly USDT could be converted into Kenyan Shillings via M-PESA in under two minutes. This clearly shows how crypto can match or exceed the efficiency of traditional fintech platforms.
The theme was clear that in Africa, crypto adoption is not driven by hype or speculation. It is a practical solution to real problems. Dollar scarcity, cross-border payments, remittance costs, and limited access to global platforms. This is less about ideology and more about economic survival and opportunity.
With regulation and increased adoption of crypto tools like OTC desks and stablecoins, African countries can unlock new levels of financial inclusion.
Also Read: Kenya’s VASP Bill Hailed as Most Progressive in Africa in New Yellow Card Report
