Nigeria, June 16 -- The International Monetary Fund (IMF) has warned that the growing use of US dollar-denominated stablecoins in Nigeria could weaken demand for the naira, and undermine the effectiveness of the country's monetary policy framework.

IMF observed in a report titled "Stablecoins in Nigeria: A Growing Cross-Border Channel" on Tuesday, noting that the widespread use of stablecoins poses risks to monetary sovereignty, particularly as more individuals and businesses turn to digital dollar-linked assets for savings and transactions.

The warning comes as Nigeria continues to rank among the world's largest crypto markets.

The country received about $59 billion in crypto-asset inflows between July 2023 and June 2024, ranking seco...