According to Bernstein’s research report published on Wednesday, the stablecoin market will grow from $125 billion today to $2.8 trillion in the next five years. The report states that integration with consumer platforms will lead to a growth spree for stablecoins, thereby attracting users to market and distributions going beyond crypto platforms.
Analysts led by Gautam Chhugani state that they expect global financial and consumer platforms to jointly issue stablecoins, resulting in significant growth.
This week, payments giant PayPal (PYPL) announced its entry into the crypto market by introducing the dollar-pegged PayPal USD (PYUSD). This development will be a first among major financial companies. The Ethereum-based token will be sold first on PayPal and then on Venmo and can be exchanged for dollars. According to the Bernstein report, stablecoins will be backed by layer-2 or centralized consumer platforms on public blockchains like Ethereum.
Stating that politically stablecoin regulations have received more support than crypto, the report draws attention to the fact that many jurisdictions, including Singapore, Hong Kong and Japan, have started pilot projects in the stablecoin and CBDC areas.