Citigroup predicts that stablecoins will become a mainstream economic zone in 5 years, with a market capitalization reaching trillions of dollars.

Citibank predicts that stablecoins will surpass cryptocurrencies within five years, deeply integrate into the mainstream economy, replace some traditional currencies, and transform payments and finance, with huge growth potential. (Summary: Payment giant Stripe launched a "stablecoin account" to support USDC and USDB, open to more than 100 countries, is it available in Taiwan?) (Background supplement: US stablecoin legislation urgent" Democratic Party brakes: GENIUS law has loopholes, crypto-friendly policies become Trump's self-fattening tools) Stablecoins are at a crossroads of transformation, Wall Street giant Citibank recently released a report boldly predicting that in the next five years, these tokens linked to the value of legal currencies such as the US dollar, the market size will not only expand significantly, but also have the potential to break through the existing framework of cryptocurrencies, gradually replace some traditional currency holding methods, and deeply integrate into the global mainstream economy. Citibank clearly predicts in its "Future of Finance" report that in the next five years, stablecoins may not only replace some physical US dollar cash held in overseas and domestic markets, but also become an indispensable part of the mainstream economic system. At the heart of this shift revolves around the expected expansion of market size, fundamental changes in usage patterns, and the critical role played by the regulatory environment. Stablecoin growth dual engine In terms of market size, Citibank put forward an optimistic outlook in its recent report: under a regulatory-backed baseline scenario, the stablecoin market is expected to reach $1.6 trillion by 2030, and if the situation is more favorable, this figure is even expected to climb to $3.7 trillion. Compared to the current stablecoin market of about $240 billion (of which USDT issued by Tether is about $145 billion and USDC issued by Circle is about $60 billion) and the total global cryptocurrency market capitalization is about $3.45 trillion, this forecast clearly reveals the huge growth potential of stablecoins. In doing so, regulatory clarity and support are seen as key catalysts for such growth. Ronit Ghose, global head of future finance at the Citi Institute, emphasized that a sound regulatory framework is critical to the successful integration of stablecoins into the mainstream economy, and is even expected to make their market larger than the entire cryptocurrency exchange ecosystem. At present, legislative attempts such as the draft Digital Asset and Payment System Opportunity and Innovation Act (GENIUS Act) proposed by the United States and the Crypto-Asset Market Regulation (MiCA) implemented by the European Union are committed to providing clearer legal guidance for stablecoin issuance standards and reserve management. Payments Innovation The payments and remittances sector is fast becoming a key beachhead for stablecoins to expand and move into the mainstream economy. According to Fireblocks, while payments companies account for only 11% of their customer base, they handle 16% of all stablecoin transactions, with a quarterly growth rate of more than 30%. Fireblocks is optimistic that payments companies are expected to account for 50% of stablecoin trading volume in the next 12 months. The data further shows that in the past 90 days, the total USDT and USDC trading volume on the Fireblocks platform reached $517 billion, accounting for 44% of the platform's total trading volume, of which payment-related businesses contributed $82 billion, an increase of 38.2% from the previous quarter. Compared with the traditional financial system, stablecoins show significant advantages in scenarios such as cross-border remittances, consumer payments, and business-to-business (B2B) payments, such as faster settlement, lower transaction costs, and higher transparency. Industry leaders such as Mastercard and Circle are actively promoting the widespread adoption of stablecoins in the payments space. Mastercard, for example, has embarked on a solution that aims to enable consumers to make payments to merchants around the world using stablecoins. Moreover, stablecoins are a powerful push for financial inclusion in emerging markets by lowering the barrier to entry for those in emerging markets who are underbanked or unbanked. Beyond Payments: The Diverse Applications of Stablecoins and the Potential for Financial Change The potential applications of stablecoins go far beyond payments and remittances. Its applications are expanding and are expected to serve as a key "cash pillar" in the trading of tokenized financial assets, or be integrated into banks' short-term liquidity management tools. If the future regulatory environment allows for the issuance of interest-bearing stablecoins, they may even play an important role in areas such as time deposits and retail money market funds. Furthermore, the rapid expansion of the stablecoin market is expected to significantly boost demand for short-term U.S. Treasury bills, which could have a profound impact on the dynamic balance of the Treasury bill market and the servicing costs of government debt. For the traditional banking industry, the rise of stablecoins is undoubtedly a double-edged sword. On the one hand, it may bring competitive pressure by diverting part of the deposit; On the other hand, it also opens up space for innovative products and services in the banking industry, with Citigroup's Ronit Ghose using a metaphor when exploring the relationship between stablecoins and central bank digital currencies (CBDCs), which central banks are actively studying: "From a cryptocurrency perspective, CBDCs resemble 'empires of evil,' while cryptocurrency players see themselves as 'Luke the Skywalker' (the protagonist of Star Wars)." Ghose also emphasized: "The integration of stablecoins means that they will become an integral part of the mainstream economy, for example as a settlement tool in the trading of tokenized financial assets, or widely used in the daily payment clearing of SMEs and even large enterprises." The accelerated integration of stablecoins into the mainstream economy is driven by a combination of key factors. These include the increasingly clear global regulatory framework, the adoption of institutional investors and large corporations, the inherent technological advantages of stablecoins (e.g., fast transaction speed and cost-effectiveness), and the need for stable stores of value from emerging markets, coupled with payment-friendly solutions. However, despite the promising outlook, the path of stablecoins has not been smooth. It still faces several challenges that cannot be ignored, such as the harmonization and harmonization of regulatory policies around the world, technical interoperability challenges between different blockchain networks, and potential financial risks that need to be continuously monitored and managed. Related reports Payment giant Stripe launched a "stablecoin account" to support USDC and USDB, open to more than 100 countries, is it available in Taiwan? Meta crypto payment blockbuster return? FB, IG internal test stablecoin payment, Zuckerberg's blockchain ambition has not given up "Citi predicts: stablecoins will become a mainstream economic sector in 5 years, and the market value will look at trillions of dollars" This article was first published in BlockTempo's "Dynamic Trend - The Most Influential Blockchain News Media".