Stablecoins fill gap as traders face debanking

Commodity traders in Europe are increasingly being cut off from traditional banking services as geopolitical risks linked to Iran push banks to reduce exposure.

The trend, described as “debanking,” has forced traders to seek alternative payment rails, with stablecoins emerging as a key workaround for cross-border settlement.

“Since the war, banks are further retreating from certain commodity flows,”

Said Luke Sully, adding that some traders are now losing access to banking services.

Banks are particularly concerned about counterparty risk, fearing that transactions routed through regional hubs could indirectly involve sanctioned Iranian entities.

As a result, stablecoins like USDT are increasingly used due to their speed, liquidity and ability to bypass traditional banking systems.

The shift comes within a $2 trillion trade finance market that already relies heavily on non-bank lenders, with stablecoins now playing a growing role in settlement and liquidity.

While seen as a workaround rather than a long-term solution, the rise of stablecoin usage highlights how geopolitical tensions are accelerating crypto adoption in global trade.