Tether Partners with Zanzibar to Boost Crypto Literacy and Stablecoin Usage

Tether, the issuer of the world’s largest stablecoin USD₮, has signed a Memorandum of Understanding (MoU) with Zanzibar’s e-Government Authority (eGAZ). This strategic partnership aims to boost crypto literacy and stablecoin usage in the East African archipelago, positioning Zanzibar as a potential future hub for digital asset activity. The collaboration includes plans to integrate USD₮ and XAU₮ into the government’s payment gateway, Zanmalipo, offering a more secure savings, cross-border payments, and day-to-day commerce option in a region with a history of currency instability and limited access to banking systems.

The MoU also emphasizes the importance of education in driving adoption. Tether and eGAZ plan to host workshops and seminars on blockchain technology, peer-to-peer networks, Bitcoin basics, and stablecoin mechanics for local actors, including policymakers, students, and small business owners. Additionally, the partnership aims to collaborate with local universities and research centers to integrate blockchain curricula into mainstream education, fostering a developer ecosystem and early-stage startups.

Zanzibar’s openness to crypto innovation has been growing, with the government launching a blockchain sandbox program. The Tether partnership is seen as a potential anchor initiative within this sandbox, with stablecoin testing and real-world deployment possibilities under government oversight. Local officials have indicated a broader ambition to reduce dependency on cash-based systems and leapfrog into a digitally inclusive financial framework.

While North America and Europe grapple with heavy regulation, Africa’s fragmented but fast-evolving fintech landscape offers a unique opportunity for crypto firms. Mobile penetration across East Africa is high, but formal financial inclusion remains uneven. Stablecoins like USD₮, offering low-volatility, dollar-pegged instruments accessible via smartphones, could play a vital role in bridging that gap. Tether’s move to Zanzibar also serves to illustrate a wider strategy of “crypto-diplomacy” — seeking out alliances with governments to help shape policy-making, develop sandboxes, and grow ecosystems for the longer term.

Despite the optimism, challenges remain. Zanzibar is semiautonomous, but its regulatory and financial systems are closely intertwined with the larger Tanzanian government. The success of this initiative might hinge on greater regional cooperation and legal alignment. Additionally, volatile crypto markets, past controversies involving Tether’s reserves, and infrastructure limitations, including limited high-speed internet coverage, could slow adoption if not adequately addressed.