Stablecoins and the Future of Financial Regulation

Stablecoins are reshaping global finance, enabling low-cost payments, remittances, and inclusion, but also raising risks for sovereignty, consumer protection, and stability. This chapter examines regulatory challenges with a focus on Nigeria, drawing lessons from the EU's MiCA, the fragmented U.S. model, and Singapore's balanced approach. It pursues four aims: (i) review global and regional responses; (ii) position Nigeria as a test case for emerging economies; (iii) assess the Commonwealth Model Law as a harmonizable framework; and (iv) explore how regulation can mitigate risks while fostering inclusion. Using a qualitative, desk-based design combining doctrinal and comparative analysis, the study finds Nigeria's stance to be restrictive yet experimental: a banking ban excluded stablecoins, while the SEC and eNaira signaled cautious innovation. The Model Law's tiered, risk-based framework offers a path to balance sovereignty, stability, and innovation, making Nigeria a microcosm of Global South dilemmas.