Stablecoin Market Poised for $2 Trillion Boom as US Legislation Paves the Way, Predicts Standard Chartered

According to Standard Chartered Bank, the stablecoin market could potentially increase nearly ten times, reaching $2 trillion (approximately Rs. 1,71,29,830 crore) over the next three years, following anticipated US legislation aimed at establishing a regulatory environment for cryptocurrencies.

This increase would likely necessitate an additional $1.6 trillion (about Rs. 1,37,05,008 crore) in short-term Treasury securities to be maintained as reserves by stablecoin issuers, paralleling the total volume of new T-bills expected to be offered during that timeframe, as indicated by analysts at the London-based bank in a report released on Tuesday. The current total value of the crypto market is estimated at roughly $2.68 trillion (around Rs. 2,29,56,196 crore).

Geoff Kendrick, global head of digital assets research, along with two other strategists, commented, “The US legislation concerning stablecoins — digital currencies usually pegged to a fiat currency like the USD, intended to minimize price fluctuations and streamline transactions — would further validate the stablecoin sector.” He added, “This holds significance for acquisitions of US Treasuries (for reserve needs) and the dominance of the USD.”

The growing demand for dollar-based assets such as T-bills is anticipated to be a positive outcome for the Trump administration, particularly as the US government debt market has faced turmoil recently due to the president’s international trade tariffs. These tariffs have prompted concerns that investors may seek a higher return to hold US debt amidst inflation risks and potential sales by overseas investors.

Standard Chartered is recognized as one of the mainstream banking institutions with a strong focus on cryptocurrency. The firm is also optimistic about the future of Bitcoin, projecting that its price may rise to $500,000 (approximately Rs. 4 crore) by the end of 2028. On Tuesday, Bitcoin was trading at an estimated price of $84,000 (around Rs. 72 lakh).

The Guiding and Establishing National Innovation for US Stablecoins Act, known as the GENIUS Act, is a bipartisan piece of legislation introduced in early 2025 that aims to create a regulatory framework for stablecoins in the US. This bill successfully passed a Senate committee vote in March and is progressing toward becoming law, as noted by Standard Chartered. Trump has expressed his support for the legislation.

The report stated, “If the proportion of T-bills within the total US Treasury supply stays consistent, this would suffice to accommodate all of the new T-bill issuances planned for the remainder of Trump’s second term. In terms of holdings, only money-market funds (currently holding $2.4 trillion or around Rs. 2,05,58,652 crore) of the total $6.4 trillion (approximately Rs. 5,48,24,288 crore) of outstanding T-bills would remain larger stakeholders.”

Tether Holdings SA, the issuer of the leading stablecoin USDT, is already among the largest holders of US Treasury bills. Tether, which benefits financially from the interest generated by the bonds in its reserves, reported earnings of $13 billion (approximately Rs. 1,11,357 crore) last year.

The escalating demand for Treasuries could provide a “medium-term buffer” against potential challenges to dollar supremacy arising from tariff-related anxieties, the analysts concluded.

President Donald Trump’s cryptocurrency initiative, World Liberty Financial, revealed plans to introduce a stablecoin by the end of March. The token, USD1, will be fully backed by short-term US Treasuries, dollar deposits, and other cash equivalents, according to World Liberty Financial.

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