Stablecoins Could Command Up to 20 % of Bank Deposits in Selected Emerging Markets, S&P Global Says
By [Your Name] – January 28 2026
A new scenario analysis released by S&P Global Ratings projects that foreign‑currency stablecoins—primarily those pegged to the U.S. dollar—could grow from roughly $70 billion today to as much as $730 billion across 45 emerging‑market economies. In the most aggressive outlook, the firm estimates stablecoins could represent 10‑20 % of traditional bank deposits in the 15 nations where protecting purchasing power is the paramount driver of financial behaviour.
What the report covers
The S&P Global study focuses on “foreign‑currency stablecoin adoption” and examines the potential impact of USD‑pegged tokens in a diversified set of emerging markets. The analysis is built on three fundamental forces:
- Pressure on local currencies – Persistent inflation and currency depreciation are forcing households and businesses to seek alternatives that preserve value.
- Cross‑border remittance demand – Inflows from abroad continue to be a sizable share of many economies’ foreign‑exchange earnings, and stablecoins offer a near‑instant, low‑cost conduit.
- Broader digital‑asset enthusiasm – Rising familiarity with crypto‑based products fuels interest in using stablecoins for payments, savings, and trade.
The ratings firm ran a “scenario and sensitivity” model that translates these forces into projected stablecoin holdings. The baseline assumes modest adoption; the “high‑adoption” scenario, which is the focus of most commentary, assumes that wealth‑preservation motives dominate and that stablecoins become a mainstream store of value.
Key findings
| Metric | Baseline scenario | High‑adoption scenario |
|---|---|---|
| Total stablecoin holdings in 45 EMs | ≈ $70 bn (2024) | ≈ $730 bn (future) |
| Share of bank deposits in top 15 markets | < 5 % | 10‑20 % |
| Primary drivers | Remittances, trade, digital‑asset curiosity | Wealth protection first, followed by remittances and trade |
| Impact on banking/intermediation | Minimal | Still “not material” for overall bank intermediation or monetary‑policy transmission, according to S&P |
The report singles out Argentina and Turkey as the two economies with the highest inflation averages over the past two years, positioning them at the top of the adoption ladder. Other nations showing notable upside include Nigeria, Kenya, Vietnam, and the Philippines, where dollar‑linked stablecoins already play a visible role in everyday transactions.
Context from the broader market
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Spending on stablecoin‑linked cards – Blockchain analytics firm Artemis projected that stablecoin‑backed Visa cards reached a $3.5 billion annualised spend in late 2025, a 460 % year‑over‑year increase. This metric underscores the growing use of stablecoins for consumer‑level payments.
- Geographic usage patterns – Data from the same analytics firm highlight India and Argentina as “outliers” where the USDC token accounts for roughly 47 % of stablecoin activity. In contrast, USDT remains dominant in markets such as Turkey, China and Japan.
Analyst perspective
Potential benefits
- Wealth preservation: In high‑inflation environments, a dollar‑pegged stablecoin can act as a de‑risking tool for retail savers who lack easy access to foreign‑currency accounts.
- Remittance efficiency: Stablecoins bypass traditional correspondent banking fees, shortening settlement times from days to minutes.
- Financial inclusion: Mobile‑first users can hold and transfer stablecoins with a basic smartphone, expanding participation in the formal financial system.
Caveats and risks
- Regulatory scrutiny – While S&P asserts that even the upper‑bound scenario is unlikely to destabilise banking or monetary policy, regulators in many jurisdictions are still developing frameworks for reserve transparency and consumer protection. Recent downgrades of major stablecoins (e.g., Tether’s USDT) illustrate the volatility of market confidence in reserve backing.
- Reserve adequacy – The rapid expansion of issuance could pressure issuers to maintain sufficient, high‑quality assets to back the tokens, especially if large‑scale withdrawals occur during a currency crisis.
- Bank‑digital‑asset competition – As stablecoins attract a share of deposits, banks may need to accelerate digital‑asset offerings or partner with crypto‑friendly fintechs to retain customers.
Key takeaways
- Stablecoins could become a sizable component of deposits in the most inflation‑hit emerging markets, potentially reaching 20 % in the most aggressive scenario.
- Wealth protection is the primary catalyst, followed by remittance demand and trade‑related usage.
- Even at the upper bound, S&P Global expects limited systemic impact on banking intermediation or central‑bank policy transmission.
- Regulators will likely face heightened pressure to clarify reserve‑backing standards and consumer‑protection rules as adoption accelerates.
- The split between USDC and USDT usage suggests regional preferences that could shape issuer strategies and partnership models.
Outlook
If inflationary pressures persist and stablecoin issuers can demonstrate robust, transparent reserves, the adoption curve may indeed steepen. Market participants—banks, fintechs, and policymakers—should monitor the trajectory closely, as the convergence of digital‑asset infrastructure and macro‑economic stress could reshape the financial landscape in emerging economies over the next decade.
Source: https://thedefiant.io/news/research-and-opinion/s-and-p-global-stablecoin-adoption-emerging-market-report
