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Study Reveals Concentration of Liquidity Providers in Latin America's Stablecoin Market
A recent report by Varys Capital and Verda Ventures highlights significant vulnerabilities in Latin America's stablecoin ecosystem, revealing that the region's liquidity relies heavily on just 16 firms. The study, which analyzed 494 companies involved in stablecoin operations, indicates that while there is a diverse array of wallets and consumer-facing platforms, the number of firms managing wholesale liquidity, corporate treasury, and credit is alarmingly low.
The report, published in early October 2026, emphasizes that the majority of companies in the stablecoin sector are focused on front-end services, with only a small fraction capable of handling the underlying risks associated with liquidity. Amit Chu, a partner at Verda Ventures, pointed out that many firms depend on a limited number of trading desks and exchanges for liquidity, creating a bottleneck that could lead to operational disruptions if a major provider fails.
The reliance on stablecoins in Latin America is driven by the volatility of local currencies, with annual transaction volumes reportedly reaching hundreds of billions. Businesses increasingly use dollar-pegged tokens for payments and cross-border transactions, but the lack of robust on-ramps and off-ramps complicates the conversion of stablecoins into local currencies. This concentration of liquidity providers poses risks for companies that depend on stablecoins for payroll and supplier payments, as they may inadvertently expose themselves to the same liquidity risks across different platforms.
Source: KLEA News