The Bank for International Settlements (BIS) researchers have identified that dollar-backed stablecoin inflows continue largely unaffected by capital controls across more than 130 economies, posing increasing difficulties for emerging-market regulators.

Study Findings on Stablecoin and Dollarization

The BIS compared stablecoin inflows with traditional foreign-currency bank deposits to understand how households and businesses obtain exposure to the U.S. dollar during financial stress. Both forms of dollarization rose in response to sovereign crises, banking issues, and exchange-rate fluctuations. However, only conventional deposits showed a clear reaction to restrictions on foreign currency and capital movements.

Dollar-pegged stablecoins differ from bank deposits by enabling transfers via crypto exchanges, peer-to-peer networks, and self-custody wallets, bypassing domestic banks. Researchers attribute this to stablecoins operating partially outside regulatory frameworks.

Implications for Capital Controls and Monetary Sovereignty

Capital controls designed to regulate bank deposits appear to have limited effect on stablecoin flows. Governments may mandate approval for foreign-currency deposits or restrict transfers through banks, but stablecoin transactions on blockchain networks remain accessible without such intermediaries.

The study highlights that established dollarization through deposits and stablecoins tends to persist, with little evidence that stablecoins simply replace foreign-currency deposits. Instead, both channels can simultaneously grow, increasing dollar exposure among users.

Focus on Emerging and Developing Economies

Dollar-backed tokens are expanding notably in emerging markets facing inflation, currency depreciation, and restricted foreign exchange access. Regions such as Nigeria and Latin America exhibit rising stablecoin use for remittances, trade settlement, and cross-border payments.

The BIS warns that increasing stablecoin usage could weaken monetary sovereignty as more households and companies transact or store value in U.S. dollars beyond regulated banks.

Despite capital controls historically lowering deposit dollarization by enforcing domestic rules through banks, stablecoin inflows remain broadly similar regardless of such restrictions. Digital tokens’ bearer-like nature and transferability via unhosted wallets create enforcement challenges.

The BIS Annual Economic Report 2026 notes that while blocking domestic intermediaries from handling unapproved stablecoins might limit certain transactions, such measures will likely remain imperfect.

Market response: Stablecoin-related assets showed mixed reactions following the BIS report release.