BrazilStablecoinRegulation
|8 min ReadLatAm’s $1.5 Trillion Stablecoin Revolution
Lucca Menezes
Senior Analyst
Published
Jan 16, 2026
Latin America is not doing a tech experiment, it is running a survival upgrade. When local money melts and banks exclude a quarter of adults, stablecoins do not show up as “innovation”, they show up as the least bad option. The next question is no longer “will people use dollar stablecoins”, it is who captures that usage and turns it into Nubank sized growth on Web3 rails.
From Hyperinflation To “Everyday Dollar On Chain”
In countries like Argentina and Venezuela, inflation killed the idea that national currency can store value. Under Milei, Argentina still ran 178 percent annual inflation and the peso lost more than half its value against the dollar in a year. In that environment, stablecoins stop being a speculative asset and become the de facto unit of account.
On chain, Argentina already shows this shift. Roughly sixty percent of transaction volume is in stablecoins, far above the global average, and each break of key FX levels triggers another spike of ten million dollars or more in monthly stablecoin purchases. In Venezuela, as the bolivar collapsed, USDT moved from trading chat rooms into supermarkets and property deals. Local currency and stablecoin receipts now move in opposite directions, with Tether providing a parallel financial system that cannot be dialed down by decree.
At the same time, about one hundred twenty two million adults in Latin America still have no bank account at all. They are blocked by minimum balance rules, paperwork and geography. Nubank proved that pure mobile banking can turn this vacuum into a seventy billion dollar company with more than one hundred million users, yet Nubank still pays yields that fail to beat inflation and sits on local currency. Crypto Neobanks go one step further, offering dollar based accounts without a banking license, and piping them into DeFi yields of eight to ten percent in dollar terms, which is lethal competition in high inflation economies.
Remittances add another structural driver. The region absorbs more than 160 billion dollars a year from migrants abroad, traditionally paying 5 to 6 percent in fees and waiting days for settlement. In the US Mexico corridor alone, Bitso has processed over 6.5 billion dollars, roughly ten percent of the channel, with costs that can drop to a dollar or a few cents and settlement in seconds. That is not a niche, it is a fee pool ripe for displacement.
A Market Built On Stablecoin Volume, Not Meme Cycles
Between mid 2022 and mid 2025, Latin America processed close to 1.5 trillion dollars in crypto volume with year on year growth above forty percent. Even in global drawdowns, regional activity held up, and in December 2024 monthly volume hit a record eighty seven point seven billion dollars. This is not only beta to a bull market, it is demand driven by local macro pressure.
Brazil sits at the top. It has absorbed roughly 318.8 billion dollars of crypto inflows, almost one third of the region, and about ninety percent of those flows run through stablecoins. That points to an institution heavy profile, where tokens are used for corporate payments, cross border settlement and liquidity routing rather than retail gambling.
Argentina, with roughly ninety to ninety four billion dollars of flow, is the mirror image. Growth there is retail first and tracks the way households dollarize their savings and cash flow via exchanges and over the counter desks.
Users still prefer centralized venues. Nearly seventy percent of all activity goes through centralized exchanges, one of the highest shares in the world. For Web3 builders, that means “borrow distribution, do not fight it”. Integrating with Mercado Bitcoin, Bitso and other local champions is a more realistic play than trying to replace their fiat gateways from day one.
From USDT To Yield Bearing Dollars And Local Stable Rails
On assets, the region is evolving from a single USDT pipeline to a layered mix of global and local instruments.
Tether remains the hard currency of street and peer to peer trade, especially in Argentina and Venezuela, where USDT is the default quotation unit in OTC chats. Brazilian tax disclosures suggest roughly two thirds of reported volume is still in Tether, precisely because it is liquid, familiar and relatively hard to block.
USDC is winning the opposite lane, the compliant corridor. Through partnerships with Mercado Pago, Bitso and others, it is becoming the preferred settlement asset for regulated institutions. By the end of 2024, USDC was Bitso’s number one purchased asset, around twenty four percent of buys, ahead of Bitcoin.
Local currency stablecoins are emerging as bridge assets. Mercado Libre’s Meli Dólar in Brazil plugs into tens of millions of e commerce users via Mercado Pago, turning stable exposure into card rewards and balances without exposing users to DeFi jargon. Issuers like Num Finance focus on peso and real indexed stablecoins for cross exchange arbitrage and corporate treasury operations, letting local firms manage liquidity on chain without FX risk.
The bigger structural shift is toward interest bearing assets. Protocols such as EtherFi show how you can turn a DeFi position into a consumer credit product: users stake assets, earn yield and swipe a card backed by that collateral without selling. Synthetic dollars like USDe can offer double digit dollar yields. In a region where traditional banks barely protect principal, a ten percent dollar yield is not a nice to have, it is a magnet.
Brazil, Argentina, Mexico, Venezuela: Four Paths To The Same Destination
Brazil is the most advanced and regulated sandbox. The Drex central bank digital currency project has shifted toward wholesale, leaving room for private stablecoins on the retail side. Unified tax treatment and FX rules for crypto make life more expensive but also more legitimate. Projects like Neobankless build on Solana but hide that fact behind a simple interface that plugs directly into PIX. Users deposit reals, backend systems convert them to USDC and route them into yield strategies. It feels like Web2, runs like Web3.
Argentina functions as a liberalized experiment. A virtual asset service provider registry and asset regularization plans effectively accept the presence of dollar stablecoins. Lemon Cash’s crypto cards solve the last mile problem. Users park value in USDC, harvest yield, and convert to pesos only at the point of sale. It is a simple pattern, but in triple digit inflation it maximizes the time spent in dollars and minimizes exposure to local currency.
Mexico and Venezuela sit at two extremes. In Mexico, strict fintech rules isolate banks from crypto firms, so exchanges like Bitso lean into business to business flows and use stablecoins as settlement pipes for corporates rather than retail banks. In Venezuela, with sanctions back in full force, USDT is reportedly touching even oil exports, while Binance peer to peer desks remain the lifeline for ordinary people seeking hard currency. The market has unanimously rejected the official oil backed token and embraced private stable dollars instead.
Crypto Neobanks, Zero Fee Chains And The 2026 Window
Nubank at seventy billion dollars and Revolut around seventy five billion proved that digital banks are bankable in Latin America. The entire Web3 Neobank sector still sits below five billion combined. If a Crypto Neobank captures even ten percent of Nubank’s user base using leaner unit economics, there is room for an order of magnitude repricing.
That potential rests on infrastructure. One of the biggest frictions for mainstream users is gas. Plasma, backed by Tether, is one of the first attempts to remove that. Its Plasma One chain offers zero gas transfers for USDT, turning stablecoin movement into something that feels closer to a free real time payment system than to a crypto transaction. Reaching five billion dollars in total value locked in the first twenty days suggests what happens when you bundle “bank like UX” with chain level subsidies.
Crypto Neobanks have three structural advantages over traditional banks. Settlement moves from multi day SWIFT flows to seconds. The default account currency shifts from depreciating local money to dollar stablecoins. Yield comes not from capturing the spread between deposits and loans, but from letting users tap into protocol level returns from DeFi or tokenized treasuries.
The bottlenecks are real. Banks in Mexico and Colombia still close accounts for crypto firms, and each jurisdiction in the region has its own licensing and tax maze. A winning playbook probably looks like this: start in Brazil where volume and infrastructure are deepest, focus on a narrow community rather than “being everyone’s bank” on day one, and let word of mouth and on chain incentives do the heavy lifting across WhatsApp and local social networks.
If that happens, Latin America is on track to become the first region with stablecoin finance embedded at scale into daily life, from wages and savings to shopping and remittances. For builders and investors, the realistic window to enter before the game becomes crowded is the next twelve to eighteen months. By 2026, the next Nubank sized winner in this story is likely to be not a bank at all, but a Crypto Neobank running quietly on top of stablecoin rails.
Disclaimer: This document is intended for informational and entertainment purposes only. The views expressed in this document are not, and should not be taken as, investment advice or recommendations. Recipients should do their own due diligence, taking into account their specific financial circumstances, investment objectives and risk tolerance, which are not considered here, before investing. This document is not an offer, or the solicitation of an offer, to buy or sell any of the assets mentioned.