Stablecoin Surge Could Trigger $1T Exit From Emerging Market Banks: Standard Chartered

The sharp rise in stablecoin usage could drain as much as $1 trillion from emerging market banks over the next three years as savers seek the safety and liquidity of dollar-pegged digital assets, Standard Chartered said in a Monday ￰0￱ are giving households and companies in developing economies an alternative to local banks, accelerating a post-financial-crisis shift of core banking functions into the non-bank sector, analysts Geoff Kendrick and Madhur Jha ￰1￱ are cryptocurrencies whose value is tied to another asset, such as the ￰2￱ or ￰3￱ play a major role in cryptocurrency markets, providing among other things a payment infrastructure, and are also used to transfer money ￰4￱ of these cryptocurrencies has been strongest in countries with weak currencies and high inflation, including Egypt, Pakistan, Bangladesh and Sri Lanka, where deposit flight risks are acute, the analysts ￰5￱ without offering yields, now barred under the ￰6￱ Act , stablecoins attract users prioritizing capital preservation, the report ￰7￱ Chartered forecasts the global stablecoin market will hit $2 trillion by 2028, with roughly two-thirds of demand coming from emerging ￰8￱ bank noted that while stablecoins threaten traditional deposits, they also promise cheaper remittances and faster ￰9￱ emerging market regulators are responding with digital-currency pilots and upgraded payment systems.

Still, Standard Chartered cautions that unless local authorities adapt quickly, the “stablecoin summer” could become a long winter for emerging-market ￰10￱ more: Stablecoin Market Surges on U. S. Regulation, With Circle's USDC Gaining Ground: JPMorgan