Stablecoins Are the Future But Banks Will Survive

Bitcoin and other crypto tokens fluctuate in price — sometimes wildly — behaving more like speculative securities or options than money. But stablecoins are a different matter, as their name suggests. Are they, as their proponents claim, a truly “internet-native” means of payment — in short, the future of money? Or are they, as critics warn, a mortal threat to financial stability? We think the former.

Following the passage of the GENIUS Act last summer, the US for the first time has a clear regulatory framework for the issuance of stablecoins. The result has been a boom: Fiat-backed stablecoins have surpassed $284 billion in quantity, led by Tether’s USDT and Circle’s USDC. The Treasury Borrowing Advisory Committee’s (TBAC) “Digital Money” presentation, published in April, adopted and popularized Standard Charted Bank’s forecast that total stablecoin market capitalization would reach $2 trillion by the end of 2028. Treasury Secretary Scott Bessent raised the target to $3 trillion at the Treasury Demand Conference on Nov. 12.