According to a recent survey report on the usage of stablecoins in emerging markets, the usage rate of stablecoins has been increasing, including during recent market downturns. In five emerging market countries, people are no longer just using stablecoins for cryptocurrency transactions. The most popular non trading application scenarios include currency exchange, payment of goods, remittance, and salary collection and payment.

This survey report was jointly written by payment giant Visa, venture capital firm Castle Island Ventures, digital asset division of macro hedge fund Brevan Howard Digital, and data company Artemis. It was conducted by YouGov from May 29 to June 13, 2024.

Nick Carter, general partner of Castle Island, said in an interview with The Block that due to the lack of data on how people around the world actually use stable currencies, especially in emerging markets, they commissioned this survey of more than 2500 users in Brazil, Nigeria, Türkiye, Indonesia and India. He thought that the report was very enlightening for the use of stable currencies in the real world.

The current circulating stablecoins are worth nearly $170 billion, and the author points out that these tokens, typically priced in US dollars, are "undoubtedly" the "killer applications" of cryptocurrencies. After removing the noise in MEV transactions, arbitrage and lending transactions and other obvious inorganic use cases (such as intra exchange transfers), investigators conservatively estimated that the value of settlement through stable currency in 2023 would be $3.7 trillion.

In the first half of 2024, the value of settlement using stablecoins was approximately $2.62 trillion, indicating that the usage of stablecoins seems to be growing. Based on this speed, the total settlement volume in 2024 may reach $5.28 trillion.

It is worth noting that the trading volume of stablecoins has steadily increased throughout the entire market downturn cycle. According to survey results, this indicates that stablecoins have reached new users who are not just using them for trading settlement. In addition, 57% of users stated that they have increased their use of stablecoins in the past year, and 72% of users expect their usage rate to increase in the coming year.

Common application scenarios

According to the survey, if users do not use stablecoins for cryptocurrency transactions, the most popular application scenarios include currency exchange, payment of goods, remittance, and salary collection and payment. The report states:

Although the most common purpose of stablecoin users in the sample is to trade cryptocurrencies or NFTs, other non cryptocurrency uses are not inferior. Overall, 47% of respondents stated that one of their main goals is to save in US dollars, 43% mentioned better currency exchange rates, and 39% stated to earn profits. The survey results are clear: non cryptocurrency uses account for a considerable proportion of stablecoin usage patterns in the surveyed countries

The usage of stablecoins varies in different regions. For example, in Türkiye, the most common goal is to earn profits through stable currencies, followed by cryptocurrency transactions. For Nigerians, depositing US dollars through stablecoins is the main purpose, followed by trading cryptocurrencies and obtaining better exchange rates. In addition, a report from Pintu, one of Indonesia's largest cryptocurrency platforms, shows that users will use stablecoins for B2B payments and arbitrage:

For many Indonesian users, stablecoins are easier to obtain than bank dollar services. The registration requirements for local cryptocurrency exchanges are simpler than creating a bank dollar account, so the entry threshold for users is lower

Meanwhile, users of Yellowcard, the largest cryptocurrency gold platform in Africa, have reported using stablecoins for foreign exchange trading due to frequent capital controls that restrict international transactions. The company added, "Therefore, people and businesses are turning to stablecoins to maintain payment flows, import introductions, business operations, and household support

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