LATAM stablecoin liquidity may depend on few providers, investor says

What happened

Researchers in a Latin American stablecoin (a digital token meant to hold a fixed value, usually one dollar) ecosystem report warned “fragility in the system is concentrated in its thinnest layer,” with just 16 of 494 companies focused primarily on wholesale liquidity, treasury and credit. In a newly published report from crypto venture companies Varys Capital and Verda Ventures, drawing on Verda’s Stablescape database, researchers analyzed 494 companies in the region, but found only 16 whose primary business is providing wholesale stablecoin-to-fiat liquidity, corporate treasury and credit, warning that “fragility in the system is concentrated in its thinnest layer.”

Chu said a disruption affecting a key provider could leave users holding stablecoins as they face higher costs or delays when converting them into a local currency. Stablecoins are playing a growing role in Latin America’s crypto economy.

According to a September Chainalysis report, stablecoins by June 2026 accounted for 32.1% of cross-border crypto value, and 22.1% of domestic P2P (machines connecting directly to each other, with no server in between) activity and 17.6% of personal wallet balances in the region. “The problem would be at the exits. Spreads would widen, cash-outs to local bank accounts would slow or pause, and funds in transit with the failed desk could be stuck,” he said.