According to a new report, the volume of stablecoin settlements could reach $5.28 trillion by the end of this year. The report was prepared by venture capital firm Castle Island and fintech giant Visa, with contributions from Artemis and Brevan Howard Digital.
Growth in Stablecoin Usage
According to the report, transactions settled in stablecoins reached $2.62 trillion in the first half of the year, leaving an annualized rate of $5.28 trillion. The report, 'Stablecoins: The Emerging Market Story,' focused on the usage of stablecoins in emerging markets. The report noted that the growth in stablecoin usage continues despite challenges in the crypto market and declines in exchange volumes.
Use of Stablecoins Beyond Crypto Trading
Although stablecoins are often seen as a tool for crypto trading, a survey of 2,541 crypto users in Nigeria, India, Brazil, Turkey, and Indonesia shows multiple other use cases. 47% of respondents use stablecoins for saving in dollars, 43% for better currency conversion rates, and 39% for earning yields. Other common uses include cross-border transfers (32%), payments (33%), and personal finance (34%). About 50% of respondents still use stablecoins for crypto trading and NFT trading.
Stablecoins in Nigeria
Nigeria has the highest rate of stablecoin usage among the five surveyed countries. Most respondents in Nigeria use stablecoins to save in US dollars due to the depreciation of the Naira. Castle Island co-founder Nic Carter noted that a 'crypto dollarization' event might be happening in Nigeria, where residents are shifting from the Naira to dollars via stablecoins. Nigeria also leads in various stablecoin usage metrics, including transactions and non-crypto uses.
The increase in stablecoin settlements to $5.3 trillion this year highlights their versatility and growing adoption beyond just crypto trading. This is a noteworthy trend that continues to evolve, particularly in emerging economies.
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