Circle and Tether emerge as key beneficiaries of the neobank boom

The fastest-growing digital banks in emerging markets have a common thread running through their payment rails: stablecoins. And the two companies minting those stablecoins, Circle and Tether, are reaping the rewards of a fintech expansion they didn’t have to build themselves. While neobanks across Latin America, Africa, and Southeast Asia race to sign up customers with promises of cheap transfers and dollar-denominated accounts, roughly 76% of them remain unprofitable. The stablecoin layer powering digital banking Neobanks targeting volatile economies have a compelling pitch: skip the legacy banking system, avoid forex fees that can eat up to 5% of a transaction, and settle payments instantly using blockchain rails. The stablecoins making that possible are overwhelmingly USDC and USDT. Platforms like Rizon, Altitude, Fuse, Cleva, Plasma One, and Kast have all built their services on top of stablecoin infrastructure. Even Nubank, one of the world’s largest digital banks, has integrated stablecoin functionality. Specialized services like Lipaworld are using stablecoins to facilitate cross-border payments in markets like Kenya where traditional transfer costs remain punishingly high....