Stablecoins Set for Explosive Expansion, $1.2 Trillion by 2028: Report

According to the report, the prediction rests on a stochastic autoregressive (AR(1)) model, running thousands of Monte Carlo simulations. This method prioritizes recent post-2024 trends, marked by heightened adoption and evolving regulations, to forecast future growth paths. Currently, mid-August 2025 tracking places the stablecoin market at over $275 billion, with adjusted transaction volumes rising dramatically from $10.3 trillion in 2024 to $15.8 trillion in 2025.

Crucially, the report attributes much of this projected expansion to a favorable regulatory backdrop, especially in the United States. One example is the recently passed GENIUS Act, which mandates strong reserve rules, requiring stablecoins to be backed by highly liquid assets such as U.S. Treasuries and aims to strengthen systemic resilience. This clarity, analysts argue, sets the stage for more widespread adoption.

Publicly traded stablecoin issuers like Circle and Tether typically back their tokens with short-dated U.S. government securities. Thus, if the stablecoin market indeed reaches $1.2 trillion, issuers may need to acquire around $5.3 billion in T-bills per week to maintain backing adequacy. Such flows could pressure short-term money markets, potentially pressing 3-month Treasury yields downward by 2–4 basis points, a change that, while seemingly modest, could reverberate across institutional funding costs.

While Coinbase’s outlook is bold, it's not the only projection in play. J.P. Morgan, for one, remains notably more cautious. In July 2025, the bank revised its forecast down sharply to $500 billion by 2028, according to a report by Reuters, citing limited real-world usage and strong competition from more entrenched digital payment platforms like Alipay and WeChat Pay, as well as central bank-backed initiatives such as China's digital yuan. This divergence illuminates the uncertainty that still shrouds stablecoin trajectories.

The ascent of stablecoins has raised alarms among central banks worldwide. Institutions such as the European Central Bank, the Bank of England, and the Bank for International Settlements have voiced concerns over private currency issuance potentially eroding monetary sovereignty. In response, many are fast-tracking their own digital-currency projects to compete with stablecoins’ growing footprint.

What distinguishes the Coinbase forecast is its robust computational approach: rather than assuming stablecoins will capture a slice of global money supply, it quantifies growth by harnessing stochastic simulations grounded in recent adoption patterns and regulatory improvements. This stands in contrast to broader, less granular predictions, such as those from Standard Chartered or Treasury estimates, suggesting valuations up to $2 trillion by 2028. While ambitious, these higher projections often lack similarly detailed modeling frameworks.

If reality tracks Coinbase's forecast, stablecoins could become more than just crypto-market utilities. They could evolve into a significant liquidity sink for short-term U.S. government debt, shaping Treasury issuance strategies and micro-interest rate movements. Yet mainstream impact hinges on more than modeling: stablecoin adoption must expand beyond crypto trading into payments, remittances, and other real-economy use cases. For now, most usage remains concentrated in crypto-related activities.

The Coinbase report projects a near quintuple growth in stablecoin market cap by 2028, reaching $1.2 trillion, driven by Monte Carlo–based forecasts and favorable policy environments such as the GENIUS Act. However, perspectives diverge significantly, with J.P. Morgan offering a far more modest $500 billion estimate and central bankers expressing regulatory caution.