DIGITAL DOLLARISATION THROUGH REMITTANCE CHANNELS: A STABLECOIN SUBSTITUTION VULNERABILITY INDEX FOR REMITTANCE-DEPENDENT ECONOMIES

Abstract

This article develops and applies an original analytical instrument—the Stablecoin Substitution
Vulnerability Index (SSVI)—designed to measure the exposure of remittance-dependent economies to digital
dollarisation transmitted through migrant remittance channels. Existing assessments generally treat stablecoindriven
currency substitution primarily as a function of macroeconomic instability and high transfer costs and,
therefore, tend to classify low-inflation, low-cost corridors as relatively low-risk. Using data for eight remittancedependent
economies for 2024–2025, the study constructs a five-component composite index combining
remittance dependence, the transfer cost wedge, residual financial dollarisation, digital access, and monetary
credibility. The results identify two distinct transmission channels: price arbitrage, operating in relatively
expensive corridors, and access continuity, operating in corridors that are inexpensive but institutionally more
sensitive to changes in settlement conditions. The Russia–Central Asia corridor belongs to the second type,
where the formal channel is less expensive than the stablecoin alternative and adoption is driven primarily
by settlement continuity considerations rather than price. Scenario projections for Uzbekistan through 2030
quantify the potential effects of partial substitution on foreign exchange supply and monetary policy autonomy.