- Standard Chartered predicts $1 trillion shift from emerging market banks
- Two-thirds of the global stablecoin supply is already in EM savings wallets
- Venezuela, Argentina and Brazil show how stablecoins are being adopted as both payment tools and inflation hedges
Multinational bank Standard Chartered has forecasted that over $1 trillion could move out of emerging market (EM) banks and into stablecoins by 2028, as demand for dollar-pegged digital assets accelerates globally.
In a report released Monday, the bank’s Global Research team said it expects stablecoin adoption to surge as payment networks and core banking functions increasingly shift toward non-bank providers. According to the bank, stablecoins in EMs are serving as an accessible form of US dollar-denominated savings, offering users greater stability than their local banking systems.
Emerging markets drive the shift
Standard Chartered highlighted that stablecoin usage is already more common in emerging markets than in developed ones, suggesting that the upcoming shift will be disproportionately larger in EMs. The bank estimated that stablecoin savings in EMs could grow from $173 billion today to $1.22 trillion by 2028, implying an outflow of around $1 trillion from local banking systems in just three years.
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Currently, two-thirds of the global stablecoin supply is already held in EM savings wallets, the report noted. Countries with high inflation, weak foreign reserves and large remittance inflows are especially vulnerable to this transition, as stablecoins provide a safer alternative to volatile local currencies.
Stablecoins as a hedge against inflation
Venezuela serves as a prime example of this dynamic. With annual inflation between 200% and 300%, the bolivar has lost most of its value, forcing citizens and merchants to embrace stablecoins. Prices are now commonly quoted in Tether’s USDt — locally dubbed “Binance dollars” — which has largely replaced the bolivar in everyday commerce.
Chainalysis’ 2024 crypto adoption report ranked Venezuela 13th globally, showing a 110% increase in crypto usage during the year. Stablecoins are now widely accepted by small shops, large retailers, and service providers, while crypto also accounted for 9% of the country’s $5.4 billion in remittance flows in 2023.
The trend is not limited to Venezuela. In Argentina and Brazil, high inflation and currency volatility have pushed citizens and businesses to substitute local savings with USDT and USDC. According to Fireblocks, stablecoins now make up 60% of crypto transaction volumes in both countries, underlining their role as a hedge against failing currencies.
