Jeremy Allaire is the CEO of stablecoin issuer Circle. He says that stablecoins could be 10% of “global economic money”. This could happen in the next decade or more. This may seem like a bold claim. Allaire pointed to several factors that could trigger a big jump in stablecoin use. It could happen over the next “10+ years.”
Most of the world’s largest payments companies are using this technology. They’re also exploring how to expand their usage. This is because the benefits of public chains and stablecoins are becoming clear. Allaire explained this in a June 19th post.
Allaire said the market size is in the “billions.” Putting digital dollars on blockchains can bank the unbanked. It can cut remittance costs and enable cross-border commerce.
He noted that stablecoins are becoming more accepted as digital money. They will make up more and more of the world’s $100 trillion market for electronic money. This will happen by the end of 2025.
What does it look like when 10% of the global economy is in stablecoins? And when credit intermediation moves from fractional reserve lending to on-chain credit markets? Allaire questioned. He said, “This is achievable in the next 10+ years.”
Stablecoin Market Growth Potential
The stablecoin market is worth $162 billion. It is 0.2% the size of the $80 trillion money market, by World Population Review data. Savings, money market, and checking accounts make up about $26.4 trillion, $25 trillion, and $23.6 trillion. The remaining $5 trillion comes from mints.
For Allaire’s 10% prediction to come true by 2034, stablecoins would need to grow at a rate of 47.7% each year. But it’s the estimate ignores the growth of the $80 trillion money market.
USDC is the United States dollar stablecoin issued by Allaire’s Circle. It currently has a $32.8 billion market cap. It’s the second largest stablecoin. Tether (USDT) is larger, according to CoinGecko data.
Broader Cryptocurrency Adoption
Allaire’s bullishness isn’t limited to the stablecoin market either. He believes that cryptocurrency use could grow. It could grow to “billions of users” across “millions of applications” in the next 10 or more years. Smart contracts on public blockchains will help more commerce and finance.
He even thinks that some on-chain organizations could outperform some big corporations. This would happen over that time, but he didn’t say how or in which sectors.
