A report by Standard Chartered warns that U.S.-dollar-backed stablecoins could drain over $1 trillion in deposits from emerging-market banks within the next three years.
The bank highlights Africa, Latin America, and Southeast Asia as the most vulnerable regions, where citizens use stablecoins as a hedge against inflation and to access dollar liquidity amid weak local currencies.
Africa’s Growing Stablecoin Dependence
Across Nigeria, Kenya, and Ghana, stablecoins like USDT, USDC, and PYUSD are already being used for:
- Cross-border remittances
- Savings against currency devaluation
- SME transactions across borders
See more related: Nigeria Becomes World Leader in Stablecoin Adoption, SEC Recognizes Digital Assets
This shift, while empowering individuals, could destabilize traditional banks unless local financial institutions adopt or integrate blockchain solutions themselves.
What’s Next
Standard Chartered suggests regulators may need to treat stablecoin issuers like banks, enforcing transparency, reserves, and reporting standards to avoid systemic risks
