Analysts at Goldman Sachs predict significant growth in the stablecoin market, highlighting its potential to reach several trillion dollars in the near future. They believe this could lead to structural changes in the global financial system.
This is reported by Business • Media
Forecasts for USDC and market prospects
The Goldman Sachs report notes that the current stablecoin market is valued at $271 billion, but has substantial potential for further growth. Special attention is given to the USDC stablecoin, which, according to the bank’s forecasts, will continue to increase its market share due to legislative initiatives that will promote the legitimization of the entire ecosystem.
“We believe that USDC will benefit from an increase in market share outside of the Binance platform, amid legislative initiatives that legitimize the ecosystem. Based on current trends, we forecast a $77 billion increase in USDC or a 40% average annual growth rate from 2024 to 2027,” the Goldman Sachs report states.
According to analysts, the main driver of market expansion remains payments, which have enormous potential for the development of stablecoins. According to Visa, the annual volume of the global payments market is approximately $240 trillion, of which $40 trillion is consumer spending. Currently, stablecoins are primarily used for crypto trading and to meet dollar demand outside the United States.
Discussion on the impact on U.S. government debt
U.S. Treasury Secretary Scott Bessen previously emphasized that stablecoins backed by dollars or treasury securities could become an important factor in supporting demand for U.S. debt instruments. Since stablecoins in the U.S. must be backed by dollars or government bonds, their development potentially strengthens demand for government debt.
A study by the Bank for International Settlements showed that:
“Inflows into stablecoins by 2 standard deviations reduce the yield on 3-month treasury bills by 2-2.5 basis points over 10 days.”
However, outflows from stablecoins have an even greater impact, as they increase the yield on government bonds 2-3 times more strongly than the decrease in yield during inflows.
At the same time, not all experts share optimism regarding the impact of stablecoins on the U.S. debt market. UBS analyst Paul Donovan emphasized that stablecoins are more likely to redistribute the money supply rather than increase overall demand for government debt, as money simply moves between different assets.
Amid active debates surrounding the role of stablecoins in the financial market, it is worth noting that the U.S. Securities and Exchange Commission has allowed stablecoins to be classified as cash equivalents, creating additional opportunities for their integration into the financial system.