Standard Chartered: Stablecoins Could Transform U.S. Treasury Market at $750B Threshold
The stablecoin market could begin to reshape the U.S. financial landscape once it surpasses $750 billion in market value, according to Geoff Kendrick, Head of Digital Assets Research at Standard Chartered.
In a research note published Tuesday following meetings with policymakers and market participants across Washington, New York, and Boston, Kendrick highlighted growing consensus that stablecoins — if they continue on their current growth trajectory — could soon influence government debt issuance, monetary policy, and overall demand for U.S. Treasuries.
Currently valued at around $240 billion, the stablecoin market is projected by Kendrick’s contacts to more than triple by the end of 2026. This acceleration could be driven by expanding use cases and a more defined regulatory framework, particularly if the bipartisan GENIUS Act is passed — potentially as soon as next week.
“As the U.S. stablecoin market scales, the volume of Treasury bills required to back these assets may compel the government to adjust issuance strategies — favoring shorter-duration debt over longer-term bonds,” Kendrick wrote. “This shift could reshape the yield curve and increase demand for dollar-denominated instruments.”
Stablecoins — digital tokens typically pegged to the U.S. dollar — are backed by liquid reserves such as cash or short-term government debt. Increased adoption, therefore, translates into stronger demand for T-bills, putting stablecoins in direct competition with traditional fixed-income buyers.
Kendrick met with a broad range of players, including Bitcoin miners, crypto-native firms, traditional hedge funds, and regulators. He reported near-universal interest in stablecoins as the sector’s next growth driver.
He added that upcoming waves of stablecoin issuance may not be limited to crypto-native firms. Banks, and possibly even municipal entities, could soon enter the arena.
Emerging markets, Kendrick warned, may experience the earliest disruptions. Citizens in these economies are increasingly using stablecoins as digital savings tools, potentially draining domestic banking systems and limiting central banks’ access to reserves. For countries dependent on dollar liquidity to manage exchange rates or enforce capital controls, this trend could challenge financial stability.
In the U.S., Kendrick noted that stablecoins could divert corporate treasury funds from traditional banking channels into blockchain-based instruments. However, the pace and scale of this migration remain uncertain.
Investor enthusiasm for the sector is already evident. Shares of Circle (CRCL), the company behind USDC, have climbed 540% since its public listing last month — a clear signal that public markets see stablecoins as central to the next evolution of digital finance.
