First Quarter Sees East Africa Surpass Global Peers in Reducing Stablecoin Exchange Rate Spreads, According to Latest Borderless Benchmark Data
In a significant development, the foreign exchange rates of stablecoins in Latin America have reached parity with interbank rates during the first quarter of 2026, as revealed in the Borderless Benchmark Quarterly Insights report. Meanwhile, East African countries witnessed a substantial compression of pricing gaps, with some corridors seeing reductions of up to 81%.
The report's analysis of over 1.15 million rate observations across 51 currencies provides valuable insights into the stablecoin foreign exchange market. The data suggests that East Africa's Kenyan shilling, Tanzanian shilling, and Rwandan franc have seen significant compressions in pricing gaps, ranging from 60% to 81%, due to intensified competition among multiple providers.
In contrast, Zambia's kwacha experienced a dramatic widening of its pricing gap, with a 701 basis point increase over a five-week period in March. This volatility in frontier corridors is expected to have a significant impact on operations in the second quarter of 2026.
The report categorizes the stablecoin foreign exchange market into three tiers: corridors with institutional-grade pricing, those in active price discovery, and those with only sell-side data. Latin America, led by the Brazilian real, has achieved institutional-grade pricing, with a quoted execution cost of 0 basis points from multiple providers over two consecutive months.
The Mexican peso, Colombian peso, and Chilean peso also demonstrated tight execution costs, staying within 22 basis points of interbank rates throughout the quarter. However, the Argentine peso and Congolese franc remain outliers due to capital controls and a dual exchange rate regime, resulting in stablecoin premiums of 473-596 basis points and 3,500 basis points, respectively.
In Africa, the Kenyan shilling's pricing gap narrowed from 176 basis points in January to 33 basis points in March, representing an 81% compression. Similarly, the Tanzanian shilling and Rwandan franc saw significant reductions in their pricing gaps, with declines of 80% and 60%, respectively.
The report notes that where competition is limited, pricing gaps tend to hold or widen. For instance, the South African rand's pricing gap increased from 66 basis points to 121 basis points, while the Ghanaian cedi's gap remained wide, finishing March at 616 basis points with only two providers quoting buy and sell rates.
The Nigerian naira's stablecoin premium decreased by 193 basis points over the quarter, partly due to the entry of a new provider in February. The West African franc and Zambian kwacha exhibited significant within-month swings, with the latter's pricing gap widening by 701 basis points in just five weeks.
The report also tracked the median stablecoin premium across 28 currencies in the Asia-Pacific, Middle East, and European regions, finding that every corridor remained within 20 basis points of interbank mid-rates. The Philippine peso and euro were the only corridors outside of Latin America and Africa with full bid-ask data available.
As Borderless expands its provider network in the Asia-Pacific, Middle East, and European regions, the Borderless Benchmark Quarterly Insights series will provide more comprehensive analysis of execution costs and pricing gaps. The second quarter of 2026 is expected to be marked by significant developments, including the potential continuation of pricing compression in East Africa, the emergence of two-sided liquidity in sell-only corridors, and the stabilization or further volatility of frontier markets like the Zambian kwacha.