Stablecoins Reach $314B as Regulation and Institutional Demand Accelerate
The stablecoin market has surged past $314 billion, led by Tether’s USDT and Circle’s USDC, according to Canaccord Genuity. Analysts attribute the growth to regulatory clarity from the GENIUS Act, which classifies compliant stablecoins like USDC as cash equivalents in the U.S., boosting confidence and adoption across the sector.
Joseph Vafi and his team at Canaccord said this framework strengthens the case for stablecoins to become the “money layer” of the internet. Pegged to assets such as the U.S. dollar or gold, stablecoins provide essential payment infrastructure and facilitate cross-border transfers. Despite rapid expansion, the market remains underpenetrated compared with the U.S. M2 money supply, leaving significant room for growth through 2026.
Institutional Competition Intensifies
Competition in the sector is heating up. Tether, the largest stablecoin issuer with nearly 70% market share, plans to launch a U.S.-regulated stablecoin, USAT, by the end of 2025, aiming to raise $15–20 billion to support its expansion.
Other major players are entering the space. Citigroup is reportedly exploring a stablecoin initiative, while Visa announced a pilot program for April 2026. At the same time, USDC circulation is growing faster than anticipated, signaling intensifying competition among issuers.
Stablecoins as a Catalyst for Crypto Growth
While stablecoins are not directly tied to bitcoin (BTC $106,718.30), Canaccord said their adoption is likely to spur broader growth across the crypto ecosystem. By integrating into global payments and settlement systems, stablecoins enable investment in digital wallets, custody solutions, and next-generation DeFi applications.
This creates a reinforcing cycle: as stablecoins become more embedded in the financial system, they strengthen the infrastructure that supports the wider cryptocurrency industry, solidifying their role as a foundational layer for digital finance.
