According to Cointelegraph, Mexico's central bank has issued a warning in its latest financial stability report, highlighting the potential risks posed by stablecoins to financial stability. The report points to the rapid growth of stablecoins, their connections to traditional finance, and global regulatory gaps that could lead to arbitrage and amplify market stress. The central bank, known as Banxico, emphasizes the vulnerabilities within the stablecoin sector, noting its heavy reliance on short-term US Treasurys and market concentration, with two issuers controlling 86% of the supply. Past incidents of stablecoin depegging further underscore the sector's susceptibility to stress.
Banxico cautions that without coordinated international safeguards, mass redemptions or issuer failures could impact broader funding markets. The report also highlights diverging regulatory approaches as a growing risk factor, with frameworks like the EU's MiCA and the US GENIUS Act imposing different reserve, redemption, and depositor-protection requirements. These discrepancies create regulatory gaps that could encourage arbitrage across jurisdictions. Despite acknowledging the benefits of stablecoins in improving settlement efficiency, reducing transfer costs, and supporting remittances and liquidity in decentralized finance, Banxico plans to maintain a cautious distance between the traditional financial system and virtual assets due to their potential to cause stress in broader markets.
Crypto adoption in Mexico remains relatively low, as indicated by Chainalysis' Global Crypto Adoption Index. The country dropped to 23rd place in 2025 from 14th place in 2024 in the adoption ranking. This cautious stance reflects Mexico's broader approach to crypto, as the country has not introduced significant new digital-asset legislation and continues to rely on its 2018 Fintech Law as the primary regulatory framework. In contrast, other Latin American countries like Brazil and Argentina have embraced crypto adoption more readily. Chainalysis' 2025 Geography of Crypto Report reveals that Latin America generated nearly $1.5 trillion in crypto transaction volume from July 2022 to June 2025, with Brazil leading the region by receiving $318.8 billion in crypto value during this period. Argentina ranked second with $93.9 billion in transaction volume.
The central banks of Brazil and Argentina are taking proactive steps in regulating digital assets. In November, Brazil's central bank finalized rules that place crypto companies under banking-style supervision, treating stablecoin transactions and certain self-custody wallet transfers as foreign exchange operations. Meanwhile, Argentina's central bank is reportedly considering allowing traditional financial institutions to trade cryptocurrencies, potentially reversing its 2022 ban, as reported by La Nación. This approach contrasts with Mexico's cautious stance, highlighting the varying regulatory landscapes across Latin America.