The competition for stablecoin supremacy is advancing into a third phase, with major players like Tether and Circle steadily establishing their positions amidst a backdrop of tighter regulations. This shift, highlighted by evolving oversight from the European Union’s Markets in Crypto Assets (MiCA) and U.S. legislative changes, is expanding the field to include banks and significant payment firms contemplating integrating stablecoins into their operations.
Key Points:
- Banks and payment companies are poised to join the stablecoin sector as regulations adapt to allow their entry.
- According to Ran Goldi, SVP of Payments at Fireblocks, the market could witness at least 50 new stablecoins by the year’s end.
Stablecoins have surged in significance, acting as critical instruments for transferring value in a highly volatile cryptocurrency market, especially given the limited access to fiat transactions. Tether, with a market capitalization nearing $145 billion, leads the stablecoin space, while Circle’s USDC holds over $60 billion in circulation and is reportedly eyeing a public listing.
“Expect banks to start issuing stablecoins due to MiCA regulations,” Goldi remarked in a recent interview. He noted the increasing involvement of financial institutions such as Robinhood, Ripple, and Revolut aiming to launch their stablecoins. The early phases of this evolution witnessed competition primarily between USDC and Paxos but have since shifted towards a race between USDC and USDT. As more established firms complete strategic assessments, the anticipation builds around who will dominate the forecastedly expansive stablecoin market, projected to reach $2 trillion by 2028 according to Standard Chartered.
