Citigroup Predicts 1000% Stablecoin Growth by 2030

Citigroup has predicted that blockchain technology could be on the verge of a significant breakthrough, with regulatory changes potentially driving widespread adoption by 2025. This moment is likened to the rapid acceptance of ChatGPT in the artificial intelligence sector, suggesting a potential tipping point for blockchain’s integration into mainstream finance and public use.

The investment banking giant highlighted the surging adoption of stablecoins as a key driver behind what could be a pivotal year for the cryptocurrency industry. According to Citigroup, the total outstanding supply of stablecoins could reach $1.6 trillion by 2030 in a base case scenario, and up to $3.7 trillion in a bullish scenario. Currently, the total stablecoin supply stands at approximately $240 billion, suggesting a potential market expansion of over tenfold in just a few years. This growth is attributed to increased adoption in both the financial and public sectors, facilitated by regulatory clarity.

Citigroup emphasized that regulatory advancements are crucial for the mass integration of stablecoins into traditional finance. As global frameworks evolve, stablecoins are expected to play a central role in cross-border payments, tokenized assets, and retail use cases. However, the bank also presented a more conservative projection, stating that if adoption hurdles and integration challenges persist, the stablecoin market may only reach $500 billion by the end of the decade—still more than double its current size.

This forecast comes as stablecoins gain more attention from policymakers and financial institutions. Entities are expanding their offerings amidst tighter regulatory scrutiny. Citigroup’s analysis positions stablecoins at the core of blockchain’s evolution from a speculative asset class to a real-world financial infrastructure.

The report suggests that 2025 could be a transformative year for blockchain technology, driven by regulatory changes that facilitate significant adoption across various sectors. This moment is likened to the rapid acceptance of ChatGPT, indicating a potential tipping point for blockchain’s integration into mainstream finance and public use.

Citigroup also noted that the stablecoin supply will remain US dollar-denominated, with non-US countries promoting national currency or a central bank digital currency. However, there are still some challenges ahead for the market. The stablecoin market cap could settle around $500 billion if “adoption and integration challenges persist.” Depegging has also been flagged as a potential issue, with 1,900 instances in 2023, including the major USDC depeg following the collapse of Silicon Valley Bank.

A major depegging event would likely dampen crypto market liquidity, trigger automated liquidations, impair trading platforms’ ability to meet redemptions, and potentially have broader contagion effects for the financial system. Despite these challenges, the overall outlook for stablecoins and blockchain technology remains positive, with regulatory support and increased integration into financial institutions setting the stage for significant growth in the coming years.