- Standard Chartered projects up to $500 billion outflows from U.S. banks to stablecoins by 2028.
- Geoffrey Kendrick highlights stablecoin market growth and impact on U.S. banking.
Such a shift could significantly impact U.S. banks reliant on net interest margins, raising concerns about financial stability and regulatory responses in the evolving digital asset landscape.
Standard Chartered’s Global Head of Digital Assets Research, Geoffrey Kendrick, projects significant bank outflows to stablecoins by 2028. According to the analysis, up to $500 billion could potentially shift from U.S. bank deposits if the stablecoin market grows to $2 trillion.
Stablecoin issuers like Tether and Circle are involved, with U.S. Treasury bills comprising a substantial portion of their reserves. Geoffrey Kendrick, Global Head of Digital Assets Research at Standard Chartered, projected up to $500 billion in outflows from U.S. bank deposits to stablecoins by 2028 due to low bank deposit holdings by issuers: Tether (USDT) at 0.02% and Circle (USDC) at 14.5% of reserves, directing funds to U.S. Treasury bills instead.
Regional U.S. banks, particularly vulnerable due to high reliance on net interest margins, might face significant challenges. Financial markets could experience substantial shifts, with dollar-pegged stablecoins posing a potential threat.
Potential outcomes include notable financial, regulatory, and technological impacts. Historical trends and data provide insights on how stablecoin market expansion could influence broader financial ecosystems, highlighting the need for market readiness.
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