Institutional investors and wealth managers are anticipating a significant boom in the stablecoin market, with projections indicating a substantial increase in both market capitalisation and transaction volumes. According to a global study by CrossLedger Capital, a regulated credit fund, 85% of investors expect the stablecoin market cap to surpass $3 trillion within five years, a stark rise from $200 billion at the end of last year.
The research, which surveyed investors from 13 countries including the US, UK, and Singapore, highlights that over $27 trillion in transactions were processed through stablecoins last year—tripling the previous year’s figures. A notable 78% of respondents believe this will reach $100 trillion within two years, with 49% predicting the $50 trillion mark will be achieved this year.
CrossLedger Capital’s findings suggest that stablecoins will play a crucial role in decentralised finance (DeFI), with 98% of investors agreeing they provide the necessary stability and liquidity. However, concerns remain about the risks associated with stablecoins, particularly their reliance on reserves such as precious metals or fiat currencies. Regulatory uncertainty and potential instability in the US dollar are also seen as significant risks.
Graham Cooke, CEO and Founder at Brava, commented on the findings, stating, “Institutional investors and wealth managers worldwide are well aware of the stablecoin growth story and expect it to accelerate in the near term with market capitalisation and value of transactions expanding rapidly.”
As the stablecoin sector continues to evolve, the focus remains on its broader applications and the associated risks, which investors are keenly aware of.
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