Latin America's Stablecoin Ecosystem at Risk of Disruption: Report

Amit Chu, a partner at Verda Ventures, warns that Latin America's stablecoin payment ecosystem may be vulnerable to disruptions due to a lack of underlying liquidity providers. According to a report by Varys Capital and Verda Ventures, only 16 companies in the region provide wholesale stablecoin-to-fiat liquidity, corporate treasury, and credit. This concentration of liquidity providers raises concerns that 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.

The report analyzed 494 companies in the region and found that many sellers of liquidity rely on a small number of specialists, which could lead to fragility in the system. Chu notes that while mature FX markets have fewer dealers than customer-facing firms, the key to reducing concentration is clearer rules that would make it easier for banks to serve liquidity providers.

Stablecoins have been playing a growing role in Latin America's crypto economy, with 32.1% of cross-border crypto value, 22.1% of domestic P2P activity, and 17.6% of personal wallet balances attributed to stablecoins by June 2026, according to a Chainalysis report. The report also notes that countries with the greatest monetary instability exhibited the fastest growth in stablecoin adoption.

Chu suggests that local-currency stablecoins could allow more market makers to settle transactions onchain, while global trading firms are beginning to quote Latin American currency pairs. However, he also cautions against assuming that a small number of specialists necessarily signals a problem, and emphasizes the importance of redundancy and capital in the system.