JPMorgan analysts led by managing director Nikolaos Panigirtzoglou said rising stablecoin velocity—the frequency with which the same stablecoin is used in transactions—may limit market capitalization growth despite accelerating usage. The analysts noted that increased efficiency in stablecoin-based payment systems drives higher velocity, allowing the same amount of stablecoins to handle significantly more transactions.
“In our opinion, the more widely used stablecoin-based payment systems become, the higher their efficiency and thus their velocity,” the analysts said in a report. “In turn, higher velocity would likely limit the expansion of the stablecoin universe going forward, even if their usage in payments rises exponentially from here.”
JPMorgan’s Stablecoin Market Outlook
This represents a consistent analytical position from JPMorgan. In December, the analysts projected the stablecoin market cap at around $500–$600 billion by 2028, cautioning against broader industry forecasts. In May, they characterized trillion-dollar stablecoin market projections by others as “far too optimistic.”
Recent Market Growth and Transaction Volume
Despite the velocity thesis, stablecoin markets have expanded significantly. The stablecoin market cap increased by nearly $100 billion over the past year, with total size exceeding $300 billion when including yield-bearing stablecoins, according to JPMorgan analysts. This growth has outpaced the overall crypto market cap, suggesting stablecoins are serving purposes beyond trading or crypto collateral.
Onchain stablecoin transaction volume has grown substantially, running at an estimated annual pace of approximately $17.2 trillion based on year-to-date data. The analysts attributed this acceleration partly to the passage of the GENIUS Act in the U.S. last year, which reflects increasing adoption of stablecoins for payments.
Payment Use Cases and Regional Trends
While consumer-to-consumer payments remain the largest activity segment, consumer-to-business and merchant payments are growing at faster rates, the analysts noted, citing data from venture capital firm a16z crypto. Asia continues to dominate stablecoin usage globally.
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