Stablecoins, digital assets pegged to stable currencies like the US dollar, are forecasted by Citi to become a significant part of the global financial system, reshaping how money is held, moved, and managed.
Originally designed for crypto traders, stablecoins are now being utilized in payments, remittances, and business liquidity management, with potential use in replacing a portion of currency reserves and facilitating various financial transactions.
Citi predicts the stablecoin market to grow from $250 billion to $1.6 trillion by 2030, with key drivers including increased global payments, substitution for physical cash, adoption in tokenized financial transactions, and demand in regions with unstable currencies.
However, regulatory clarity is essential for stablecoin growth, as uncertainties and integration challenges could hinder progress. Despite challenges, Citi envisions stablecoins becoming a cornerstone of the mainstream economy by the end of the decade.