The Stablecoin Usecase LATAM Actually Wants

Since the earliest days of crypto, emerging markets have been positioned as the natural first adopters. Currency volatility, inflation, and geopolitical unrest underscore the need for censorship-resistant, sovereign money. But after a year of conversations with founders across Brazil, Mexico and Argentina, a few observations stand out.

Stablecoin adoption doesn’t always extend to speculative products

An estimated 57 million people, representing roughly 12% of Latin America, own crypto assets, but the behaviors around ownership are very different from what we’ve seen in more mature financial markets.

During Devconnect Buenos Aires last fall, we met with the Lemon team and got to see the energy in person. Lemon app continues to be one of the best places to buy, save and spend your crypto in Argentina.

During the 2022-2023 crypto bear market, Lemon released a report comparing its active users to Coinbase users.

The trend clearly suggests Lemon users are less sensitive to price movements and speculative actions. The data revealed an important difference: users were less reactive to price volatility (across the bear market) and speculative trading patterns. They demonstrated a preference for holding Bitcoin or USD-denominated stablecoins and used these assets primarily as savings vehicles regardless of where BTC or ETH was trading.

If you fast forward to today, many founders assume they can convert users by offering Bitcoin savings or USD stablecoin accounts, then gradually introduce them to trading across a wide range of crypto assets. Trading continues to be the most prevalent use case for all digital assets. However, this approach misunderstands why people actually engage with crypto in the region. While some users may adopt these products in the future, it’s primarily a savings function today. As a result, features like yield or underwiting credit against crypto savings make much more sense than introducing products like perpetuals trading.

Every country has vastly different payment infrastructures

This is where the generalized "LATAM opportunity" narrative breaks down.

Brazil is a perfect example, with the most mature financial ecosystem in the region. Brazilians already have PIX, a free instant payment system available to everyone. Brazil also offers treasury yields around 15% to offset anticipated inflation. When you can earn that kind of return holding Reals, the case for parking savings in USD stablecoins gets weaker. Integration with PIX is great but it’s clear that the pain point of costly payments is not felt for most Brazilians.

Similarly, Mexico has seen 71% of adults using SPEI for low value transactions offering them an easy and instant payment option.

The assumption that users across LATAM want to spend stablecoins is flawed —payment infrastructure is much more advanced in the most mature financial economies and the realities of daily life require transacting in your local fiat (e.g., PIX in Brazil). Therefore extending the stablecoin use case to payments typically doesn’t work unless you’re making it as easy as using local fiat (e.g., credit cards like Redotpay). Any localized payments use case will only work if it's better than the existing solutions in terms of ease of use, access or cost.

Brand and trust are true moats

Despite advanced payments infrastructure, institutional trust remains fragile. In markets with weaker institutional and judicial systems, trust isn’t optional; it is the primary enabler of economic activity. A survey conducted by Latinobarometro in 2023 suggested 52% of LAC respondents have little or no confidence in their financial systems. While this should be taken with a critical perspective, it speaks to a broad feeling across the continent.

Newer entrants like NuBank in Brazil have demonstrated the importance of trust and brand over the past decade. Today, the business has an NPS that is 3x higher than incumbent banks and they’ve become the primary bank for 59% of active customers. NuBank’s brand and trust have been painstakingly built over the past decade, with majority of their early users coming through word of mouth growth. Nubank didn't start with high trust, but by solving a concrete pain point through a fee-free credit card that was meaningfully cheaper than alternatives and difficult to say no to.

Drawing a parallel with stablecoins and crypto - it’s important to solve actual user problems. Trust builds through use, not abstract explanations of crypto's values. Education works best when anchored to problems users already care about. Ultimately, trust is earned by consistently solving real problems over time.

The bottom line

The LATAM opportunity is one of the most compelling and exciting areas to build for today. But capturing it requires understanding the specific dynamics of each market, not applying a generalized ‘emerging markets need crypto’ playbook. The founders who win will be the ones who have experienced these markets and have differentiated strategies for building user trust and solving user problems. If you're building in these markets and have a hard-earned perspective on what new financial products must be built, I'd love to chat.

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Thank you to those at Blockchain Capital who gave invaluable feedback on the article.

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