Stablecoin Resurgence: The Transformation Path of Future Banking

The global stablecoin market is entering a rapid growth phase again after experiencing an 18-month decline. It is expected that by the end of 2025, the supply of stablecoins will reach $300 billion, and it is likely to exceed $1 trillion by 2030. This trend is mainly driven by three long-term factors:

1. The application of stablecoins as a savings tool
2. The Application of Stablecoins in the Payment Sector
3. DeFi offers yields above market rates, attracting digital dollars inflow.

The stablecoin market size has expanded to $1 trillion, bringing new opportunities and transformations to the financial system. Some changes are already foreseeable, such as the migration of bank deposits from emerging markets to developed countries, and regional banks transforming into globally systemically important banks (GSIB). However, many potential impacts have yet to emerge. Stablecoins and DeFi, as infrastructure innovations, may fundamentally reshape the credit intermediation model in the future.

Three Major Trends Driving Stablecoin Adoption

Trend 1: Stablecoins become a savings tool

Stablecoins are increasingly becoming a savings tool, especially in emerging markets. In countries like Argentina, Turkey, and Nigeria, the structural weakness of local currencies, along with inflation and depreciation pressures, has led to an organic demand for the US dollar. However, the circulation of the dollar in these markets has been restricted, becoming a source of financial pressure. Stablecoins bypass these restrictions, allowing individuals and businesses to easily access dollar-backed liquidity via the internet.

Surveys show that obtaining US dollars is one of the primary reasons emerging market users adopt cryptocurrency. Although it is difficult to quantify the savings scale based on stablecoins in emerging markets, this trend is rapidly growing. Stablecoin settlement card services such as Rain and Reap have emerged, allowing consumers to use their savings at local merchants through the Visa and Mastercard networks.

Taking Argentina as an example, fintech application Lemoncash reports that its $125 million "deposits" account for 30% of the centralized crypto application market share in Argentina. This means that the asset management scale of crypto applications in Argentina is approximately $417 million, accounting for 1.1% of the country's M1 money supply. Considering that Argentina is just one of many emerging markets, the demand for stablecoins among consumers may expand horizontally across various markets.

( Trend 2: stablecoins become payment tools

Stablecoins have become a viable alternative payment method, especially in competing with SWIFT in the cross-border payment sector. Compared to traditional cross-border transactions that take more than 1 business day, stablecoins have significant advantages. In the future, stablecoins may become a meta-platform connecting various payment systems.

According to the Artemis report, B2B payment use cases contributed $3 billion in monthly payments among 31 surveyed companies, annualizing to $36 billion in ). Through communication with major custodians, the actual annualized payment volume could exceed $100 billion. The report also found that from February 2024 to February 2025, B2B payment volumes increased fourfold year-on-year, indicating that the asset management scale of stablecoin ### AUM ( is also growing correspondingly.

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) Trend 3: DeFi offers yields higher than the market

In the past five years, DeFi has consistently generated dollar-denominated yields structurally higher than the market, allowing more technically skilled users to achieve returns of 5% to 10% with lower risk. This has driven the popularity of stablecoins.

DeFi is a unique capital ecosystem, whose underlying "risk-free" interest rate reflects the broader crypto capital market. The supply rates of protocols like Aave, Compound, and Maker are responsive to the underlying trading and leverage demand. As long as blockchain continues to generate new ideas, the foundational yield of DeFi should remain strictly higher than the yield of U.S. Treasury bonds.

As the "native language" of DeFi is stablecoins rather than US dollars, any "arbitrage" behavior attempting to provide low-cost dollar capital to meet this specific market demand will lead to an expansion of the stablecoin supply. Narrowing the interest rate spread between Aave and US Treasury bonds requires stablecoins to expand into the DeFi space. Data shows that when the interest rate spread between Aave and US Treasury bonds is positive, the total locked value ( TVL ) will grow, while it decreases when the spread is negative.

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Bank Deposit Issues

The adoption of stablecoins may lead to the disintermediation of traditional banks. It allows consumers to directly access dollar-denominated savings accounts and cross-border payments without relying on banking infrastructure, thereby reducing the deposit base that banks use to stimulate credit creation and generate net interest margin.

) bank deposit alternative

Currently, each 1 dollar stablecoin is typically backed by 0.80 dollars in treasury bills and 0.20 dollars in bank deposits. Taking Circle as an example, its 61 billion USDC is backed by 8 billion cash ( 0.125 dollars ) and 53 billion in ultra-short-term U.S. Treasury securities or repurchase agreements ### 0.875 dollars (. Circle's cash deposits are primarily held in major U.S. financial institutions such as Bank of New York Mellon.

When consumers transfer savings from traditional bank accounts to stablecoin accounts such as USDC or USDT, they are essentially moving deposits from regional/commercial banks to U.S. Treasury securities and major financial institutions. This will reduce the deposit base available for lending at commercial banks and regional banks, while making stablecoin issuers important participants in the government debt market.

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) Forced credit tightening

One of the key social functions of bank deposits is to lend to the economy. The fractional reserve system allows banks to lend out several times the amount of their deposit base. When stablecoins make up a large proportion, it may significantly affect the regional credit creation capacity. This could force regional banking regulators to consider measures to maintain credit creation and financial stability.

excessive allocation of credit to the U.S. government

Currently, stablecoin issuers have become the twelfth largest buyers of U.S. Treasury bonds and may potentially become one of the top five buyers in the future. The new proposal requires that all Treasury securities be supported either in the form of repurchase agreements backed by Treasury securities or in the form of short-term Treasury bonds with a maturity of less than 90 days. This will significantly enhance the liquidity of key segments of the U.S. financial system.

When the scale reaches one trillion dollars, this could have a significant impact on the yield curve, distorting the interest rate curve that U.S. government financing relies on. On the other hand, Treasury repurchases have not actually increased the demand for short-term U.S. Treasuries, but instead provided an available liquidity pool for secured overnight borrowing.

new asset management channel

This trend has created a brand new asset management channel, similar to the transformation from bank loans to non-bank financial institutions (NBFI) after Basel III. Stablecoins siphon funds out of the banking system, especially from emerging market banks and regional banks in developed markets.

If the stablecoin issuer decides to outsource credit investments to professional companies, they will become limited partners of large funds ###LP( and open up new asset allocation channels. Large asset management companies have achieved scale expansion in this context.

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) Effective Frontier of On-Chain Yield

Each stablecoin is both a claim against the underlying dollar and a unit of value on-chain. Consumers need returns priced in stablecoins such as USDC, like Aave-USDC, Morpho-USDC, etc. Various "vaults" will provide consumers with on-chain yield opportunities, opening up another asset management channel.

New vaults will emerge in the future to track different on-chain and off-chain investment strategies, competing for USDC/T holdings across various applications. This will create an "effective frontier of on-chain yields," where some on-chain vaults may specifically provide credit to regions like Argentina and Turkey, which are at risk of losing this capability in their banking systems.

Conclusion

The integration of stablecoins, DeFi, and traditional finance not only represents technological innovation but also marks the reconstruction of global credit intermediation, reflecting and accelerating the shift from bank to non-bank lending after 2008. By 2030, the asset management scale of stablecoins will approach 1 trillion USD, which will systematically change the structure of traditional bank deposits and concentrate assets into U.S. Treasury bonds and major financial institutions.

This transformation brings both opportunities and risks: stablecoin issuers will become important participants in the government debt market and new credit intermediaries; while regional banks ###, especially in emerging markets (, face credit tightening. The end result is a new asset management and banking model, with stablecoins becoming a bridge to efficient digital dollar investment frontiers. Stablecoins and DeFi protocols are positioning themselves as dominant credit intermediaries in the digital age, which will have profound implications for monetary policy, financial stability, and the future architecture of global finance.

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