Standard Chartered estimates $1 trillion could exit emerging market bank deposits for US stablecoins by 2028

Standard Chartered estimates that up to $1 trillion may shift from emerging market bank deposits into stablecoins over the next three years, as dollar-pegged tokens give households and companies a low-friction path to USD exposure outside local lenders.

Stablecoins are dollar-pegged crypto tokens designed to keep a steady value. They’re typically backed 1:1 by cash and short-dated U.S. Treasurys, and are redeemable on demand.

Geoffrey Kendrick, Standard Chartered’s global head of digital assets research, and Madhur Jha, global economist and head of thematic research, argue that these coins have effectively become “USD-based bank accounts” for many EM users.

Historically, emerging markets have been hotspots for stablecoin adoption, primarily due to their large unbanked populations. The bank says this dynamic could intensify even under the U.S. GENIUS Act’s zero-yield requirement for compliant issuers, because “return of capital matters more than return on capital.”

“While the recently passed U.S. 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,” analysts wrote.

Standard Chartered projects global stablecoin market value to reach $2 trillion by end-2028 — a forecast it notes the U.S. Treasury has referenced — and estimates that about two-thirds of today’s supply functions as savings in EM bank accounts.

Stablecoin savings surge in EMs

Analysts predict that EM stablecoin “savings” could potentially rise from roughly $173 billion today to $1.22 trillion by 2028, implying more than $1 trillion in deposit outflows from EM banks.

“Indeed, future growth in stablecoin use for savings is likely to expand from a small number of wallets with large balances currently to a large number of wallets with small holdings,” Kendrick and Jha stated. “At scale, small holdings will be significant; this growth is likely to occur mostly in EM, where demand for a liquid, 24/7, trustworthy alternative to local banks is greater.”

Standard Chartered’s framework also ranks Egypt, Pakistan, Colombia, Bangladesh, and Sri Lanka among the most exposed to a bank deposit exodus. Countries such as Turkey, India, China, Brazil, South Africa, and Kenya were also listed among the areas most likely to witness a rush to stablecoins.

Experts stressed that its vulnerability map serves as a starting point, not the destination. Capital-account openness, remittance dynamics, inflation trajectories, and credibility of monetary frameworks could all influence where each country lands on what the bank calls an “opportunity-risk continuum.”

Opportunity-risk continuum for bank deposits-to-stablecoin outflows | Image: Standard Chartered

However, the bank’s bottom line is clear: stablecoin demand in EMs has already been meaningful, and a trillion-dollar shift from deposits into tokenized dollars is likely now a base case, not a tail risk.

Beyond deposit flight, the report flags pressure on correspondent banking, payments, and FX revenues. These concerns could be partially offset if banks custody reserves for issuers or embed stablecoins into treasury, settlement, and cross-border rails, the analysts said.

Authorities are also moving to blunt risk. Many EMs are piloting CBDCs, upgrading “fast payment” infrastructure, and promoting digital literacy as mobile money usage climbs in Sub-Saharan Africa.

Still, competitive and technological currents suggest adoption is broadening. Tether has been preparing a U.S.-compliant product (USAT) and expanding rails, while Stripe has unveiled tools to help companies launch their own stablecoins. Builders are pushing further into emerging markets, such as Plasma’s stablecoin-focused L1.

Meanwhile, Coinbase’s Jesse Pollak has argued that non-USD stablecoins are needed for real-world utility. His argument suggests that outflows may be distributed across currencies, not just into dollars.

The report lands amid a market upswing that pushed the stablecoin sector’s capitalization above $300 billion for the first time, led by Tether USDT and Circle’s USDC, according to The Block’s data dashboard.

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