3 reasons why stablecoin growth thrives globally — Will US follow under Trump?

While the Trump administration lays the preliminary groundwork for crypto industry regulations in the US—with the White House’s new crypto czar expected to set the course in the coming months—these digital assets are already thriving in emerging markets. For precisely the good reasons.

Pegged to fiat currencies, stablecoins are becoming an important financial tool for many in the developing world, fueling remittances and cross-border trade, bridging financial inclusion gaps, and offering a hedge against inflation in countries where traditional banking often falls short, and millions are left with little to no access to financial services.

Stablecoins—mostly pegged to the US dollar—have seen explosive growth in recent years, with real-world use cases expanding rapidly across Africa, Latin America, and parts of developing Asia. While the US is still figuring out how to apply this technology beyond the crypto space, emerging markets are already proving why stablecoins matter. 

In these regions, they’re not just a financial experiment—they’re a solution.

Stablecoins as a hedge against inflation in South America

In inflation-ridden economies like Argentina and Venezuela, stablecoins offer a dollar-pegged refuge from depreciating local currencies, especially where access to foreign currency exchanges is tightly controlled. Throughout Africa and Central America, they serve as a cost-effective tool for remittances and cross-border payments, while in places like Indonesia, they can provide a more accessible alternative to traditional USD banking, which can involve complex requirements.

While in richer, more advanced economies, stablecoins are primarily used in decentralized finance and as a bridge between traditional banking and DeFi, in emerging markets with limited financial infrastructure, their role is more fundamental yet essential, Cornell University Trade Policy professor Eswar Prasad said,

“In low and middle-income economies with underdeveloped financial systems, they can play a useful role in providing citizens and businesses easy and widespread access to a low-cost digital payment system.” 

Access to the US dollar—widely seen as a global store of value—has been a key driver of stablecoin adoption in emerging markets. Designed to offer stability in contrast to the volatility of early cryptocurrencies like Bitcoin, most stablecoins are dollar-pegged, with USDT (USDT) Tether leading at nearly 60% of the global market, followed by USDC (USDC), another dollar-backed asset.

“There are problems in the world that need to be solved by a cryptocurrency that doesn’t constantly fluctuate in price,” Julián Colombo, senior director at Bitso, a Mexican crypto exchange with an official presence in Argentina, Brazil, and Colombia, said in an interview with Cointelegraph. 

“Stablecoins offer a way to bring all the benefits of crypto to real-world use cases—not just the potential to get rich off Bitcoin.”

Stablecoins are a priority for Trump’s crypto czar

Momentum is growing in the United States around stablecoins, as a bipartisan group of senators introduced legislation on Feb. 4 to establish a regulatory framework. In his first address to the industry, White House AI and crypto czar David Sacks emphasized that stablecoin regulation is a top priority for the administration, with the former venture capitalist leading a task force set to draft key policies over the next six months.

At any rate, stablecoin growth has been nothing short of spectacular. In the past year alone, they’ve tacked on a staggering $100 billion in market value, soaring to a total of $225 billion as of February 2025, according to DelfiLlama. USDT still reigns supreme, commanding over 60% of the market, but challengers—including those backed by financial powerhouses like PayPal—are rapidly gaining ground. 

“Stablecoins – tokenized representations of fiat currencies circulating on blockchains 1 – are unambiguously the “killer app” of crypto so far,” a report authored by Castle Island Ventures and sponsored by VISA mentioned. 

“We believe stablecoins represent a payment innovation that has the potential to expand access to secure, reliable, and convenient payments to more people in more places,” Cuy Sheffield, Global Head of Crypto at the US payments giant, said. 

“While they initially emerged as a crypto-native collateral type and settlement medium for traders and exchanges, they have crossed the chasm and have found wide adoption globally in the ordinary economy,“ it was argued in the report. 

“Based on the divergence between stablecoin activity and crypto market cycles, it is evident that stablecoin adoption has moved beyond merely serving crypto users and trading use cases.”

Seen as a store of value, a hedge against inflation, and a tool for cross-border transactions, stablecoins have gained significant traction in emerging markets. A recent Chainalysis report found that in regions like Africa, Eastern Europe, Latin America, and Asia, stablecoin adoption far outpaces that of Bitcoin, accounting for nearly half of all crypto transactions in some cases. 

In contrast, the US and North America have the lowest adoption rate for stablecoins in North America, though it still holds a notable share.

In places like Brazil, a Latin American powerhouse with a population of 216 million and a $2.2 trillion GDP, the use of stablecoins has surged wildly in recent years, its central bank governor Gabriel Galipodo said. As much as 90% of the entire crypto flow is linked to stablecoins, the economist said while speaking at a Bank for International Settlements event in Mexico City on Feb. 6.

“Most of that is to buy things and to shop things from abroad,” said Galipolo, emphasizing that this novel trend brought with it intense oversight challenges regarding taxation.

But nowhere in Latin America have stablecoins found greater adoption than in Argentina, Julián Colombo, who leads the local operation at regional exchange Bitso, said. Amid the country’s chronic inflation and economic instability, they offer a vital financial refuge for citizens.

Related: US lawmakers propose stablecoin bill to boost dollar dominance

“In Argentina, as in other high-inflation countries, stablecoins have emerged as a solution to a very real and pressing problem,” Colombo said to Cointelegraph.

“Argentines don’t trust the local currency and prefer to save in dollars, but government-imposed exchange controls and restrictions make access difficult. Stablecoins have filled that gap, providing a way to hold and transact in USD.” 

In Argentina, he says, roughly two out of every three crypto purchases through the exchange are made in dollar-pegged assets. While Argentina’s financial indicators have improved under pro-crypto President Javier Milei’s market-driven administration, inflation remains high at 84.5% year-over-year.

Though recent monthly data shows a downward trend, rebuilding trust in the local currency will take time in a country long plagued by triple-digit inflation and severe currency devaluations, ensuring sustained demand for stablecoins pegged to the US dollar.

Similarly, the adoption of such digital assets has been significant as well in Venezuela, which suffers from chronicle inflation as well as a myriad of regulations that make access to foreign currency like the USD highly convoluted. In emerging markets with somewhat more stable currencies like Brazil or Mexico, they can serve a different but equally important purpose: enabling fast, low-cost money transfers without the volatility of traditional cryptocurrencies. 

Businesses use them to pay for international services, hire remote employees, send dividends, and facilitate remittances, making cross-border transactions more efficient and accessible.

“In contrast to other crypto assets, stablecoins come with a promise of stability,” the Bank of International Settlements said in a report about stablecoins. “Due to this potential, they are increasingly entering mainstream finance, and a number of jurisdictions have developed regulatory approaches for issuers of stablecoins pegged to a single fiat currency.”

Stablecoins fuel remittances in Central America and Africa

One of stablecoins most powerful use cases comes in the form of cross-border transfer and remittances, particularly in Central America and Africa, with these digital assets providing an alternative for cheaper and faster money flows across international borders. Migrants working in the United States have often found in stablecoins a vehicle for more convenient transfers to families back home, 

“Stablecoins are getting some traction for both domestic and cross-border payments,” Prasad, who teaches Trade Policy at US Cornell University, said to Cointelegraph. “They are already playing a particularly useful role in overcoming the inefficiencies, high costs, and slow processing times for cross-border transactions conducted through traditional payment channels.”

Referencing the popularity of stablecoin use in remittances, Colombo said, 

“Before crypto, remittance services could charge up to 10% in fees just to send money from one country to another. With crypto, you might have some extra money to send to Mexico, and the transfer could cost just a cent—arriving in minutes instead of hours or days.”

Cases for non-crypto use of stablecoins grow

In the Visa-sponsored report, researchers conducted a survey of approximately 500 crypto user individuals in Nigeria, Indonesia, Turkey, Brazil, and India for a total sample of 2,541 adults. While access to crypto remains the most popular motivation to use them, non-crypto uses such as access to dollars, generating yield or transactional purposes are highly popular.

The survey revealed that Nigerian users have the strongest affinity for stablecoins compared to other countries surveyed. Nigerians transact with stablecoins the most frequently, have the largest share of stablecoins in their portfolios, use them for the widest range of non-crypto purposes, and report the highest self-reported knowledge of stablecoins. Saving money in dollars was their top priority.

Across Africa, stablecoins have become the “holy grail” for cross-border trade, international remittances, and value transfer across the continent, according to Zekarias Dubale, co-founder of the Africa Fintech Summit. He argued that these digital assets could offer the necessary financial infrastructure to facilitate global trade.

The case for stablecoins, however, is not without risks. While the most widely used stablecoins have largely maintained their peg to the strong fiat currencies they are designed to mirror, the market is expanding rapidly, with hundreds of digital assets now in circulation. Many of these assets, however, lack transparency about the reserves backing them, and instances of stablecoins depegging and, in some cases, collapsing have occurred.

Despite this, stablecoins are gaining momentum in the United States under the Trump administration and across emerging markets, where they are proving to be powerful tools that can help citizens overcome challenges related to financial inclusion and underdeveloped infrastructure.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.