Citigroup Research: The stablecoin market size may reach $3.7 trillion by 2030, impacting the traditional banking ecosystem.

On April 25, 2025, Citigroup Research released a report on the "Digital Dollar." The report indicates that 2025 could become a pivotal moment for the application of Blockchain in the financial and public sectors, driven by regulatory changes.

The research report predicts that by 2030, the total circulating supply of stablecoins could grow to $1.6 trillion under the base case, $3.7 trillion under the optimistic scenario, and about $500 billion under the pessimistic scenario. It is expected that the supply of stablecoins will remain dominated by US dollars (about 90%), while non-US countries will drive the development of their own central bank digital currencies.

The regulatory framework for stablecoins in the United States may drive new net demand for U.S. Treasury securities, and by 2030, stablecoin issuers could become one of the largest holders of U.S. Treasuries. Stablecoins pose a certain threat to the traditional banking ecosystem by substituting deposits. However, they may also provide opportunities for banks and financial institutions to offer new services.

Stablecoins are a type of cryptocurrency designed to maintain a stable value by pegging the market price to a reference asset. These reference assets can include fiat currencies like the US dollar, commodities like gold, or a basket of financial instruments. Key components of the stablecoin system include the stablecoin issuer, the Blockchain ledger, reserves and collateral, and digital wallet providers.

As of April 2025, the total circulating supply of stablecoins has exceeded $230 billion, growing by 54% since April 2024. The top two stablecoins dominate this ecosystem, with a market share of over 90% in terms of value and trading volume, with USDT in the lead, followed by USDC.

The driving factors for the adoption of stablecoins in the United States and globally include practical advantages, macro demand, support and integration from existing banks and payment providers, as well as the long-awaited regulatory clarity. User experience, regulatory clarity, and innovation and efficiency are also important factors driving the development of stablecoins.

Citigroup Research expects the baseline scenario for the stablecoin market size in 2030 to be $1.6 trillion, the optimistic scenario to be $3.7 trillion, and the pessimistic scenario to be $0.5 trillion. The main application scenarios for stablecoins include cryptocurrency trading, business-to-business payments, consumer remittances, institutional trading and capital markets, as well as interbank liquidity and cash management.

Stablecoins share some similarities with the bank card industry or cross-border banking services, both having a high network or platform effect. However, political and technological developments may lead to more differentiation in the stablecoin sector, similar to the development of the bank card market.

Many countries may continue to focus on developing their own central bank digital currencies as a tool for national strategic autonomy. At the same time, stablecoins provide new business opportunities for banks and financial institutions, including acting directly as stablecoin issuers or providing related services.

However, stablecoins may also impact the traditional banking system, similar to the "narrow banking" effect. The transfer of bank deposits to stablecoins may affect the lending capacity of banks, and this change may at least suppress economic growth during the transition period of system adjustment. In this regard, differing opinions suggest that this may reduce systemic risk, or it may impact credit creation and economic growth.