JPMorgan Chase: Stablecoin supply may reach $500-600 billion by 2028, far lower than optimistic expectations.

PANews reported on December 20th that, according to Coindesk, JPMorgan Chase stated that the supply of stablecoins could reach $500 billion to $600 billion by 2028, far lower than the most optimistic forecast of $2 trillion to $4 trillion. They indicated that the demand for stablecoins is primarily a problem within the crypto market, rather than a payment issue.

JPMorgan Chase points out that the stablecoin market has grown by approximately $100 billion this year, reaching about $308 billion, with Tether's USDT and Circle's USDC leading this growth. Demand remains primarily driven by cryptocurrency trading, as well as collateral needs in derivatives and DeFi, with derivatives trading venues adding approximately $20 billion in stablecoin holdings.

Analysts say that the current drivers for payments are relatively small, but this could grow as more service providers test stablecoin-based cross-border transfer channels. However, wider payment usage doesn't necessarily require a larger stablecoin circulation, as token velocity can increase with deeper integration. Furthermore, banks and payment networks are also securing their position in institutional fund flows through tokenized deposits and other blockchain initiatives, while CBDC initiatives could offer regulated alternatives to compete with private stablecoins.