{"id":120308,"date":"2025-04-15T20:28:57","date_gmt":"2025-04-15T20:28:57","guid":{"rendered":"https:\/\/teknomers.com\/en\/standard-chartered-projects-stablecoin-market-including-usdt-and-usdc-may-reach-2-trillion-by-late-2028\/"},"modified":"2025-04-15T20:28:57","modified_gmt":"2025-04-15T20:28:57","slug":"standard-chartered-projects-stablecoin-market-including-usdt-and-usdc-may-reach-2-trillion-by-late-2028","status":"publish","type":"post","link":"https:\/\/teknomers.com\/en\/standard-chartered-projects-stablecoin-market-including-usdt-and-usdc-may-reach-2-trillion-by-late-2028\/","title":{"rendered":"Standard Chartered Projects Stablecoin Market, Including USDT and USDC, May Reach $2 Trillion by Late 2028"},"content":{"rendered":"

What is the expected impact of the Genius Act on the stablecoin market?<\/strong> How does the proposed legislation aim to legitimize the stablecoin industry in the U.S.?<\/strong> What role do stablecoins play in both cryptocurrency markets and international money transfers?<\/strong> What implications does an increase in stablecoin supply have for U.S. Treasury purchases?<\/strong> How might the industry’s shift to a model used by USDC affect the composition of stablecoin reserves?<\/strong> <\/p>\n

The Guiding and Establishing National Innovation for U.S. Stablecoins (Genius) Act is expected to be passed in the U.S. in the coming months, and that could trigger an almost 10-fold jump in stablecoin supply, investment bank Standard Chartered said in a research report Tuesday. U.S. legislation "would further legitimise the stablecoin industry," analysts led by Geoff Kendrick wrote, adding that "we estimate this would cause total stablecoin supply to rise from $230bn today to $2tn by year-end 2028." Stablecoins are cryptocurrencies whose value is tied to another asset, such as the U.S. dollar or gold. They play a major role in cryptocurrency markets and are also used to transfer money internationally. The bank noted that the proposed legislation was cleared by the Senate Banking Committee in March and looks likely to be passed by Congress and then signed off by President Donald Trump around the middle of the year. <\/p>\n

An increase in stablecoin supply has implications for U.S. Treasury buying and U.S. dollar hegemony, the report said. The bank’s estimated increase in stablecoin issuance would require the additional buying of $1.6 trillion of Treasury bills over the next four years. "This would be enough to absorb all the fresh T-bill issuance planned for the rest of Trump’s second term," the authors wrote. Increased demand for dollar-denominated stablecoin reserves would result in additional demand for U.S. dollars, the bank said, and this should support dollar hegemony. Standard Chartered said it expects the industry to move to the model used by USDC issuer Circle, the second-largest stablecoin issuer, which holds 88% of its reserves in Treasury bills with an average duration of 12 days. Tether, the largest stablecoin issuer, holds 66% of its USDT reserves in Treasury bills, the report noted. <\/p>\n

Read more: XRP Could Hit $12.5 Before President Trump’s Term Ends: Standard Chartered<\/a><\/strong><\/p>\n

Market for Stablecoins Like USDT, USDC Could Grow to $2 Trillion by End-2028: Standard Chartered<\/strong><\/p>\n

The financial landscape is undergoing substantial changes, driven largely by innovations in digital currencies. Among these, stablecoins\u2014cryptocurrencies pegged to traditional fiat currencies\u2014have gained significant traction. A recent report by Standard Chartered has projected that the market for stablecoins, particularly prominent players like Tether (USDT) and USD Coin (USDC), could reach an astonishing $2 trillion by the end of 2028. This surge would mark a pivotal change in the financial ecosystem, reshaping how transactions are conducted, how businesses operate, and how investors approach cryptocurrency.<\/p>\n

Understanding Stablecoins<\/h3>\n

To appreciate the potential growth of the stablecoin market, it\u2019s crucial to comprehend what stablecoins are. Unlike more volatile cryptocurrencies like Bitcoin or Ethereum, stablecoins maintain a 1:1 peg with fiat currencies, primarily the US dollar. This feature is vital as it enables users to avoid the price fluctuations typical in the broader cryptocurrency market. For example, USDT is designed to consistently maintain the value of one US dollar, while USDC is also dollar-pegged, with strong backing from established financial institutions.<\/p>\n

There are generally three types of stablecoins: fiat-collateralized, crypto-collateralized, and algorithmic stablecoins. Fiat-collateralized stablecoins, like USDC and USDT, hold reserves of fiat currency as collateral to offer users stability. This structure makes them suitable for various applications, from day-to-day transactions to remittances, and serves as a bridge for investors entering the cryptocurrency space from traditional finance.<\/p>\n

Current Market Analysis<\/h3>\n

As of 2023, the total market capitalization of stablecoins hovers around $150 billion. The significant market potential highlighted by Standard Chartered\u2019s report reflects ongoing trends in crypto adoption, increasing regulatory clarity, and the growing ecosystem surrounding decentralized finance (DeFi) and digital assets. Several factors underpin this projected growth, including the expansion of financial technology, the need for immediate and low-cost transactions, and the rise of the gig economy, which has created a demand for instant payment solutions.<\/p>\n

Key Drivers of Growth<\/h3>\n
    \n
  1. \n

    Increasing Adoption by Businesses<\/strong>: With companies like Tesla and PayPal already accepting cryptocurrencies as payment, the acceptance of stablecoins is on the rise. Firms recognize stablecoins\u2019 utility in facilitating quick transactions, minimizing fees, and improving cash flow management. As more businesses integrate stablecoins into their payment infrastructures, demand is expected to surge.<\/p>\n<\/li>\n

  2. \n

    Enhanced Regulatory Clarity<\/strong>: Governments and regulators around the globe are becoming increasingly aware of stablecoins and their implications. Regulatory frameworks can provide the legitimacy and stability needed to encourage more institutions and investors to participate in this market. As more countries work toward creating clear guidelines for the usage of stablecoins, this will likely catalyze further growth.<\/p>\n<\/li>\n

  3. \n

    Liquidity and Market Efficiency<\/strong>: Stablecoins offer advantages in liquidity, enabling users to quickly convert between cryptocurrencies and fiat without significant price fluctuations. This attribute is particularly attractive in volatile markets, as stablecoins provide a relatively stable refuge. Enhanced liquidity can lead to market efficiency, attracting more traders and investors.<\/p>\n<\/li>\n

  4. \n

    The Rise of Decentralized Finance (DeFi)<\/strong>: DeFi protocols have gained immense popularity, providing users with opportunities to lend, borrow, and earn interest on their digital assets. Stablecoins play a crucial role in this ecosystem, serving as a base currency for trading pairs and collateral for loans. The expansion of DeFi is expected to significantly boost the demand for stablecoins, contributing to their projected market growth.<\/p>\n<\/li>\n

  5. Global Remittances and Financial Inclusion<\/strong>: Stablecoins have the potential to revolutionize the remittance market by offering a cheaper and faster alternative to traditional channels. This feature is especially beneficial for people in developing countries, where remittance fees can be prohibitively high. By facilitating low-cost transactions, stablecoins can enhance financial inclusion globally.<\/li>\n<\/ol>\n

    Challenges on the Horizon<\/h3>\n

    While the growth prospects are promising, the stablecoin market is not without its challenges. Regulatory hurdles and concerns about transparency remain significant barriers. Critics question the reserves backing fiat-collateralized stablecoins and the potential for market manipulation. Furthermore, the competitive landscape is rapidly evolving, with numerous projects aiming to capture market share, and this could impact the dominance of established players like USDT and USDC.<\/p>\n

    Conclusion<\/h3>\n

    The projection of a $2 trillion market for stablecoins by 2028 reflects the massive potential within the sector. As technological advancements continue, combined with evolving regulatory frameworks, stablecoins could redefine the financial landscape. Their ability to bridge the gap between traditional finance and the digital world positions them as essential tools for businesses, consumers, and investors alike. Ultimately, the journey forward will depend on innovation, regulatory clarity, and the commitment of stakeholders to navigate the challenges ahead. With the right momentum, stablecoins are set to play a defining role in the future of finance, unlocking immense value for global users.<\/p>\n

    According to a report by Standard Chartered, the market for stablecoins, such as Tether (USDT) and USD Coin (USDC), is projected to reach $2 trillion by the end of 2028. This anticipated growth is attributed to a variety of factors, including the increasing demand for cryptocurrencies and the growing adoption of blockchain technology across different sectors. As more investors and businesses seek stability and security in digital assets, stablecoins are positioned to play a significant role in the evolving financial landscape. The report indicates that regulatory developments, advancements in technology, and the expansion of digital payment systems will further bolster the use of stablecoins, enhancing their acceptance and integration in traditional finance. The growth potential highlights the importance of stablecoins in providing a reliable medium of exchange and a safe haven during periods of market volatility.<\/p>\n

    Tm-En-7<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

    What is the expected impact of the Genius Act on the stablecoin market? How does the proposed legislation aim to legitimize the stablecoin industry in the U.S.? What role do stablecoins play in both cryptocurrency markets and international money transfers? What implications does an increase in stablecoin supply have for U.S. Treasury purchases? How might […]<\/p>\n","protected":false},"author":1,"featured_media":108984,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23832],"tags":[],"class_list":["post-120308","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance"],"_links":{"self":[{"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/posts\/120308","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/comments?post=120308"}],"version-history":[{"count":0,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/posts\/120308\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/media\/108984"}],"wp:attachment":[{"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/media?parent=120308"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/categories?post=120308"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/tags?post=120308"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}