JPMorgan: Stablecoin supply may reach $500 billion to $600 billion by 2028, far below optimistic expectations

According to Coindesk, JPMorgan stated that by 2028, the supply of stablecoins could reach between $500 billion and $600 billion, far below the most optimistic expectations of $2 trillion to $4 trillion.

It noted that the demand for stablecoins is primarily a matter of the crypto market rather than payment issues. JPMorgan pointed out that since the beginning of this year, the stablecoin market has grown by about $100 billion, reaching approximately $308 billion, with Tether's USDT and Circle's USDC leading this growth. Demand is still mainly driven by cryptocurrency trading and the collateral needs of derivatives and DeFi, with derivatives trading venues adding about $20 billion in stablecoin holdings.

Analysts indicated that the current drivers for payment business are relatively small, but as more service providers test cross-border transfer channels based on stablecoins, the payment business may grow. However, broader payment usage does not necessarily require a larger circulation of stablecoins, as the velocity of tokens may increase with deeper integration. Additionally, banks and payment networks are also working to protect their positions in institutional fund flows through tokenized deposits and other blockchain initiatives, while CBDC initiatives may provide regulated alternatives to compete with private stablecoins.