Crypto Adoption in Emerging Markets Risks Financial Resilience: Moody’s Report

Moody's Ratings has highlighted risks associated with cryptocurrency adoption in emerging markets, particularly regarding monetary sovereignty and financial resilience.

Risks are heightened when crypto is used for savings and remittances, not just investment.
Stablecoins, especially those pegged to the U.S. dollar, may weaken domestic monetary transmission by increasing pricing and settlement outside local currencies.
Moody's describes this effect as "cryptoization," similar to unofficial dollarization but with less regulatory oversight.
Cryptocurrencies can facilitate capital flight through pseudonymous wallets and offshore exchanges, affecting exchange rate stability.
Emerging markets like Southeast Asia, Africa, and Latin America show higher crypto adoption due to inflation, currency pressures, and limited banking access.
In contrast, developed economies see adoption driven by institutional integration and clear regulations.
Crypto ownership is projected to reach 562 million people by 2024, a 33% increase from 2023.