Analysts at J.P. Morgan have released a report indicating a significant reduction in growth projections for the stablecoin market. The estimated market size by 2028 is set at $500 billion, which is notably lower than previously reported figures. The primary reasons for this pessimism lie in limited mainstream adoption and regulatory challenges.
Lower Growth Projections for Stablecoins
In the latest report, J.P. Morgan analysts indicated that the stablecoin market may only reach $500 billion by 2028, half of some competitors' projections. For instance, Standard Chartered forecasts the market could reach $2 trillion, while Bernstein anticipates $4 trillion. J.P. Morgan argues that such optimistic forecasts rely on assumptions of widespread adoption that have yet to materialize.
Challenges in Adoption and Usage
According to the report, current stablecoin usage fails to meet expectations. J.P. Morgan estimates the market at $250 billion, with only $15 billion attributed to payments. Most activity remains associated with crypto trading and decentralized finance. "The idea that stablecoins will replace traditional money for everyday use is still far from reality," the bank noted in its analysis.
Regulatory Changes and Corporate Interests
Recent legislative developments, such as the Senate's passage of the GENIUS Act, spark optimism regarding stablecoin regulation. However, J.P. Morgan suggests that regulatory progress alone will not lead to the anticipated growth. Despite this, some corporations, such as Ant Group, are seeking licenses to issue stablecoins in Hong Kong. Nevertheless, J.P. Morgan argues that the successes of platforms like Alipay do not represent a credible foundation for future stablecoin expansion.
J.P. Morgan's conservative forecast reflects skepticism about stablecoin adoption beyond cryptocurrency markets, despite recent regulatory changes and corporate interest. The $500 billion projection for 2028 signifies substantial challenges that need to be addressed for mainstream acceptance of digital currencies.
