Stablecoins and financial inclusion: benefits, use cases and risks

Purpose The aim of this study is to explore the role of stablecoins in increasing financial inclusion in countries. Design/methodology/approach This study uses the conceptual discourse analysis method to discuss the role of stablecoins in increasing financial inclusion. Findings Stablecoins offer an alternative to bank accounts, lower transaction costs, remove financial intermediaries to increase the level of financial inclusion, increase competition to serve underserved adults, offer worldwide access to the underlying financial assets backing the stablecoin and greater access to on-chain savings. The risks associated with using stablecoins to increase financial inclusion include the potential for de-pegging, currency substitution, illicit financing, lack of regulatory support, technological barriers and very little consumer protection for stablecoin holders. Originality/value Several digital payment innovations have emerged with a promise to bring developmental benefits, but their relevance for financial inclusion has not been explored in the literature.