Stablecoins Nearing $750B Could Reshape U.S. Treasury Market, Says Standard Chartered

Stablecoins may soon become a powerful force in reshaping traditional financial markets if their market size reaches $750 billion by 2026, according to Geoff Kendrick, head of digital assets research at Standard Chartered.

In a research note published Tuesday following meetings with policymakers and financial players in Washington, New York, and Boston, Kendrick said a consensus is forming across the crypto sector, fund managers, and legislators: at the $750 billion mark, stablecoins could begin influencing U.S. government debt issuance, monetary policy, and the demand structure for U.S. Treasuries.

Currently, stablecoins represent around $240 billion in total market capitalization. However, Kendrick’s contacts anticipate that the figure could more than triple within the next 18 months — especially if bipartisan legislation like the GENIUS Act, aimed at regulating stablecoins, is enacted as early as next week.

“As the U.S. stablecoin market expands, the need for T-bills to back those tokens could force changes in Treasury issuance strategy,” Kendrick wrote. “That might shift issuance toward short-term debt and away from longer-dated securities, potentially impacting the yield curve and broader USD asset demand.”

Stablecoins are designed to maintain a stable value, typically pegged to the U.S. dollar, and are often backed by cash-like assets such as short-term government debt. As adoption grows, the increasing demand for these reserve assets could put stablecoins at odds with traditional fixed-income markets.

Kendrick met with a wide range of stakeholders during his U.S. trip — including crypto-native companies, traditional hedge funds, Bitcoin miners, and regulators — and noted a clear focus among all groups: stablecoins.

He also warned of potential risks in emerging markets, where individuals are rapidly adopting stablecoins as alternatives to local currencies and bank savings. This shift may weaken domestic financial systems and deplete central bank reserves, especially in nations that rely heavily on U.S. dollar liquidity or fixed exchange rate regimes.

In the U.S., stablecoins could gradually draw corporate treasuries away from traditional banking services toward on-chain tokenized cash solutions. However, the pace and scale of that transition remain uncertain.

Investor interest in stablecoins is already making waves in public markets. Shares of Circle (CRCL), the company behind the USDC stablecoin, have soared 540% since its public listing last month — a sign that many see stablecoins as foundational to the next era of digital finance.