Ripple CEO Predicts Stablecoin Market to Reach $1-2 Trillion

Ripple's CEO, Brad Garlinghouse, has expressed a widely-held belief that the stablecoin market could experience significant growth, potentially reaching $1 to $2 trillion in market capitalization within a few years. Currently, the stablecoin industry stands at around $250 billion. Garlinghouse made these remarks during an appearance on CNBC’s “Squawk Box” on Wednesday, highlighting the profound growth that the stablecoin market has already seen.

Garlinghouse attributed Ripple's late entry into the stablecoin market to the firm's focus on using stablecoins in its payment flows for institutional customers. He emphasized that Ripple's institutional background and regulatory compliance position the company well to participate in and benefit from the anticipated growth in the stablecoin market.

In conjunction with his comments, Garlinghouse announced that BNY Mellon would serve as the stablecoin custodian for Ripple's dollar-pegged asset, Ripple USD. This move underscores Ripple's commitment to regulatory compliance and institutional partnerships.

Ripple launched its enterprise-focused stablecoin, RLUSD, in late 2024, and it has since grown to a market capitalization of $500 million, a significant milestone reached on Wednesday. This growth reflects the increasing demand for stablecoins in the financial ecosystem.

Henrik Andersson, the chief investment officer of Apollo Capital, echoed Garlinghouse's prediction, stating that a $1-2 trillion market cap for stablecoins aligns with their own forecasts. Andersson noted the growing trend of fintechs, banks, social networks, and large retailers launching their own stablecoins, driven by the profitability of the business model, as exemplified by Tether.

Andersson also highlighted the potential impact of the GENIUS Act in the US, which, if passed, would make stablecoins legal tender. This legislation, which passed a Senate vote in June, is expected to be made into law this month, further catalyzing the adoption of stablecoins.

Nick Ruck, director at LVRG Research, also supported the optimistic outlook, suggesting that a crypto-friendly SEC, along with the GENIUS Act, could align the crypto industry for rapid expansion, potentially leading to a $1-2 trillion market cap for stablecoins in a few years.

Ripple, primarily serving institutional clients, is aiming to become fully compliant in the US to operate under the same framework as banks and financial institutions. Earlier this month, Ripple applied for a banking license with the US Office of the Comptroller of the Currency (OCC) and has also applied for a Federal Reserve Master Account. Garlinghouse emphasized the importance of building bridges between traditional finance and decentralized finance (DeFi).

This week, Ripple announced a significant boost for its stablecoin by integrating with Transak, a major cryptocurrency payments platform. This integration is expected to enhance the usability and accessibility of Ripple's stablecoin, further driving its adoption and growth.