Latin America’s Stablecoin Liquidity Faces Concentration Risks
- Only 16 of the 494 companies analyzed in Latin America primarily provide wholesale stablecoin-to-fiat liquidity.
- By June, stablecoins accounted for 32.1% of cross-border crypto value in the region.
- Countries with high monetary instability showed the fastest growth in stablecoin adoption.
- A disruption to a key liquidity provider could lead to wider spreads and delays in cashing out into local currency.
- The report emphasizes that improved licensing could reduce liquidity concentration risks.
The analysis highlights a potential fragility within Latin America’s stablecoin ecosystem, where a small number of providers dominate liquidity services, posing risks for users attempting to convert assets into local currencies.
With stablecoins comprising over 32% of cross-border crypto activity, ensuring a diverse range of liquidity providers is crucial for market stability and user access to funds.(Source)
