The initiative introduces EUR-denominated settlement across the corridor, combining TerraPay's cross-border payments network, COOP Bank's domestic banking reach, and Quantoz's regulated digital euro settlement infrastructure.
Ethiopia receives more than USD 5 billion in inbound remittances annually, making it one of the largest remittance-receiving countries in Africa. The launch also coincides with a period of significant reform in Ethiopia's foreign exchange regime, which is expected to increase transparency and efficiency in cross-border financial flows.
Blockchain infrastructure and regulatory framework
At the technical core of the initiative is the Xahau Blockchain, which serves as the settlement layer. Xahau is designed for financial-grade use cases and incorporates account-level smart functionality and deterministic transaction execution, and its role is strictly limited to settlement, operating alongside the existing compliance, licensing, and operational frameworks of the participating institutions.
Quantoz Payments bridges the blockchain settlement rails with regulated digital money instruments, enabling euro settlement to be handled in a manner that meets European financial regulation requirements. The arrangement provides an auditable settlement mechanism while, according to the companies, eliminating the need for costly pre-funding positions.
The regulatory and technical framework underpinning the initiative was developed in collaboration with the Inclusive Financial Technology Foundation (INFTF), an organisation that works with central banks and financial institutions across emerging markets to advance inclusive settlement infrastructure. INFTF worked alongside TerraPay and Ethiopian financial authorities to establish the necessary framework for blockchain-based inward remittance settlement.
Corridor scope and domestic reach
For COOP Bank, the initiative extends inward remittance access across Ethiopia's domestic financial system, supporting households and communities nationwide. The bank operates within Ethiopia's local banking and regulatory requirements throughout.
The EUR-denominated focus reflects the significance of Europe as a source market for Ethiopian diaspora remittances. According to the participating organisations, the corridor model is designed to be extended to additional remittance corridors in the future.
In addition, INFTF has framed the launch as a first step in a broader effort to modernise cross-border settlement in alignment with national development objectives, with the foundation of regulated institutions and financial-grade blockchain infrastructure intended to support further expansion.
