Remittances in Latin America are projected to reach a record $174 billion in 2025; stablecoins will account for 40% of cryptocurrency transactions, driven by the wave of "digital dollarization".
Remittances to Latin America and the Caribbean are projected to reach a record $174 billion in 2025, up from $161 billion the previous year. According to market research presented by Claudia Wang, Head of PBD and Global Brand Director at Bybit, stablecoins are emerging as a key growth driver, with major fintech companies and cryptocurrency services intensifying competition in the region's cross-border payments market.
The picture of remittance flows in 2025 presents many contrasts. Remittances to Mexico reached $61.8 billion but decreased by 4.5% year-on-year, the first decline in 11 years. Conversely, Central American countries recorded strong growth: Honduras increased by 19%, El Salvador by 18%, Guatemala by 15%, Colombia by 13%, and the Dominican Republic by 10%.
Total remittances to Central America exceeded $55 billion, an increase of over 20% year-on-year, while South America received approximately $36 billion and the Caribbean accounted for $21 billion. The factor behind this shift is directly related to US immigration policy; the increased risk of deportation has prompted Central American migrants to send money home more frequently and urgently.
Stablecoins and the wave of "digital dollarization"
The total volume in Latin America between July 2022 and June 2025 is expected to reach approximately $1.5 trillion, with 71% of financial institutions in the region using stablecoins for cross-border payments. The share of stablecoins in cryptocurrency transfers is projected to reach 40% by 2025, reflecting the growing demand for digital dollar assets for savings and remittances.
In Argentina, an economy plagued by persistent inflation, USDT and USDC account for over 70% of total cryptocurrency purchases; researchers call this “digital dollarization,” as stablecoins gradually replace traditional dollar-denominated savings accounts.
In Colombia, this figure reached 52%, driven by the depreciation of the peso and limited access to foreign exchange banks; in Mexico, it reached 40%, mainly from US remittances. Notably, the Central Bank of Brazil stated that approximately 90% of the country's cryptocurrency transaction volume involves stablecoins.
Demographic data from the study reveals a striking paradox: while many fintech companies focus on younger customer segments, the typical cryptocurrency remittance user in the region is a migrant aged 40–60, sending between $131 and $648 per month to family.
Over 80% of this money is spent on essential needs such as food, housing, and transportation, clearly demonstrating that this is a story about livelihoods, not just a technological trend.
The rise of digital infrastructure is reshaping the market balance. Western Union's market share in the US-Latin America corridor decreased from 29% in 2020 to 16.8% in 2024, while Remitly increased from 14% to 22.7% during the same period. Bitso is estimated to process about 10% of US-Mexico remittances in stablecoins, while Felix Pago has processed over $1 billion in transactions via USDC and Mexico's SPEI system.
Cost advantage is key: while traditional deposit fees are around 6% of the transaction value, crypto infrastructure brings fees down to 1–2%. For a migrant depositing $300 per month, the annual savings are equivalent to a family's entire monthly food budget.
One additional policy factor provides further impetus: starting in 2025, the U.S. will impose a 1% federal tax on cash remittances, affecting approximately half of all senders. This policy further fuels the shift toward cryptocurrencies and alternative payment methods, which are largely exempt from this fee.
Against this backdrop, the region's total cryptocurrency volume is projected to exceed $27 billion in 2025, with over 90% coming from USDT and USDC, two stablecoins that are gradually becoming the financial lifeline for millions of families in Latin America.
