Written by Castle Island Ventures and Brevan Howard Digital, with data from Artemis. Brought to you by Visa Crypto.
Who uses stablecoins? What are they used for? Are they just a collateral type and settlement medium for crypto traders, or something more?
Even as stablecoins have become a breakout success, these questions have plagued the policy debate. Many still believe that stablecoins, however impressive the numbers may be, are limited to crypto use cases.
We all know that the metrics are strong and climbing. The supply of stablecoins in the aggregate is around $170 billion. They settle trillions of dollars worth of value every year. Around 20 million addresses onchain make a stablecoin transaction every month. Over 120 million addresses onchain hold a nonzero stablecoin balance. These numbers indicate that stablecoins are a serious parallel financial infrastructure – having started at near zero just five years ago.
But the research space around stablecoins has thus far failed to answer the question of whether usage is limited to crypto use cases, or has begun to spill over into the ordinary financial lives of users. We decided to fix that.
In this study, we investigate stablecoin usage in five emerging markets, where gaining access to dollars is challenging or impossible. Anecdotally, we know that stablecoins are crossing the chasm into being used as digital dollar equivalents, used for remittances, cross border payments, international trade settlement, and treated as savings instruments for regular folks. But proof has been hard to come by. So we undertook a survey of 2541 crypto users in Brazil, India, Indonesia, Nigeria, and Turkey, to better understand how these individuals engage with stablecoins in their everyday lives.
We supplement these survey results with onchain data, including novel estimates of stablecoin settlement value, as well as qualitative vignettes from the companies building at the frontier of this phenomenon.
Download the report here:
The commentary contained in this document represents the personal views of its authors and does not constitute the formal view of Brevan Howard or Castle Island Ventures. It does not constitute investment research and should not be viewed as independent from the trading interests of the Brevan Howard and Castle Island Ventures funds. The views expressed in the document are not intended to be and should not be viewed as investment advice. This document does not constitute an invitation, recommendation, solicitation or offer to subscribe for or purchase any securities, investments, products or services, or any investment fund managed by Brevan Howard, Castle Island Ventures, or any of their affiliates. Unless expressly stated otherwise, the opinions are expressed as at the date published and are subject to change. No obligation is undertaken to update any information, data or material contained herein.