Citi, a global banking and financial services firm, has updated its stablecoin forecast due to the significant growth in the sector over the past six months, now estimating that the stablecoin market cap will reach $4 trillion by 2030.
Analysts at Citi foresee a $1.9 trillion stablecoin market as their “base” case, with a “bull” case projecting up to $4 trillion, an increase from previous estimates of $1.6 trillion and $3.7 trillion, respectively, as detailed in Thursday’s forecast.
Citi analysts also indicated that stablecoins will not undermine the banking sector, despite concerns raised by the banking industry, but will assist in transforming the financial system alongside innovations such as tokenized bank deposits. Citi stated:
“Skeptics again assert that banks will be disintermediated, but we do not believe crypto will dismantle the existing system. Instead, it is facilitating a reimagining of it.”
The stablecoin market capitalization exceeded $280 billion in September, with RWA.XYZ noting it reached over $287 billion in value at the time of writing.
The issuance of stablecoins soared following the enactment of the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act in the United States, which created a comprehensive regulatory framework for stablecoins and set the stage for continued sector expansion.
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Sovereign governments are considering stablecoins to strengthen their fiat currencies
In March, US Treasury Secretary Scott Bessent highlighted that stablecoins can enhance US dollar dominance by increasing global access to the currency.
Since then, stablecoins have become a crucial element of US President Donald Trump’s administration and its strategy to establish US leadership in the crypto arena.
After the passage of the GENIUS stablecoin legislation in the US, various sovereign nations began investigating the possibility of launching their own stablecoins to enhance the marketability of their local fiat currencies in global foreign exchange markets.
The Chinese government, which has historically opposed cryptocurrencies and privately-issued currencies, shifted its stance in August and is now reportedly exploring the introduction of yuan-backed stablecoins for international use.
AnchorX, a financial technology company, launched the first offshore-yuan backed stablecoin in September, designated exclusively for cross-border commercial transactions, unavailable for residents on the Chinese mainland.
Magazine: Crypto aimed to upend banks, now it’s evolving into them amid the stablecoin conflict
