Stablecoins could trigger the largest capital flight from emerging markets banks in history.
That’s according to UK bank Standard Chartered, which forecasts that as much as $1 trillion could move into dollar-pegged digital currencies over the next three years as savers in fragile economies seek deposit stability.
“Stablecoins give consumers and corporates in emerging markets new access to what is effectively a USD-based bank account,” said Geoffrey Kendrick, head of digital assets research at Standard Chartered, in a report to investors seen by DL News. “That makes deposit flight a greater risk in emerging markets than in developed markets.”
The warning comes as stablecoin issuers are flying high on the back of a slew of victories.
Over the past 10 months, US President Donald Trump’s pro-crypto policies have fuelled the crypto industry’s impressive growth. He has appointed industry supporters to key government positions, fired off a barrage of pro-crypto executive orders, and signed a landmark stablecoin bill into law.