Latin America's stablecoin market relies heavily on a small number of liquidity providers, with only 16 of 494 surveyed companies offering stablecoin-to-fiat services, creating vulnerability if key providers lose banking access. The report notes potential risks of higher conversion costs and delayed withdrawals, though lacks data on actual liquidity concentration levels.
A report by Varys Capital and Verda Ventures warns that Latin America's stablecoin ecosystem relies on only 16 of 494 companies for wholesale liquidity provision, creating potential fragility if key providers lose banking access. Concentration among liquidity providers could disrupt users' ability to convert stablecoins to local currency, though researchers acknowledge mature FX markets similarly concentrate dealers among specialists.