Stablecoins could see $1 trillion in inflows from emerging markets: Standard Chartered

• Standard Chartered projects that up to $1 trillion could be transferred from bank deposits in emerging markets into stablecoins by 2028.
• The firm stated that bank customers may utilize stablecoins as a substitute for US Dollar accounts.
• Standard Chartered previously predicted that the stablecoin market could hit $2 trillion by 2028.

Standard Chartered predicts that stablecoin users in emerging markets could shift up to $1 trillion from traditional banks into US Dollar-pegged tokens by 2028.

Standard Chartered says emerging markets could shift $1 trillion from banks into stablecoins

In a report on Monday, Standard Chartered predicted that over $1 trillion could be transferred from emerging market banks to stablecoins by 2028, following an accelerated demand for US dollar–pegged tokens.

The bank stated that adoption in these regions is being driven by a large unbanked population, who are increasingly using stablecoins as substitutes for US Dollar accounts. The report highlights that this trend could be accelerated by the enactment of the US GENIUS Act, which has a zero-yield rule for compliant issuers.

“While the recently passed US GENIUS Act aims to mitigate deposit flight by prohibiting US-compliant stablecoin issuers from paying direct yields, stablecoins are still likely to be adopted even in the absence of yield,” Standard Chartered wrote.

Standard Chartered also forecasts that stablecoin savings in emerging markets could grow from about $173 billion to roughly $1.22 trillion by 2028, implying over $1 trillion in potential deposit outflows from traditional banks. The growth is expected to come from wider retail adoption, shifting stablecoin savings from concentrated large holders to a broader base of smaller accounts.

“At scale, small holdings will be significant; this growth is likely to occur mostly in EM [Emerging Markets], where demand for a liquid, 24/7, trustworthy alternative to local banks is greater,” the report added.

The report highlights Egypt, Pakistan, Colombia, Bangladesh and Sri Lanka among the countries most vulnerable to potential bank deposit outflows. It also points to India, China, Brazil and South Africa as markets where rising demand for stablecoins could accelerate a shift from traditional banking systems to digital assets.

Standard Chartered previously forecasted the stablecoin market to reach $2 trillion by 2028, as crypto adoption rises globally. 

Meanwhile, nine European banks, including ING, UniCredit, CaixaBank and Danske Bank, are planning to launch a euro-denominated stablecoin aimed at providing a European alternative to US dollar-backed tokens.