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JPMorgan expects the stablecoin market to reach $500 billion by 2028, signaling slower growth than widely anticipated. This projection challenges the $1 trillion to $2 trillion targets set by other institutions. The bank attributes this modest outlook to limited mainstream use and ongoing dependence on crypto-native demand.

Most Stablecoin Demand Still Comes From Crypto Insiders

JPMorgan’s latest research attributes 88% of current stablecoin activity to trading, DeFi, and crypto treasury operations. These figures suggest the market remains internal primarily, with minimal penetration into broader financial systems. In contrast, stablecoin use for actual payments represents just 6% of overall demand.

This disparity helps explain JPMorgan’s conservative growth projection compared to others promoting exponential expansion. The bank maintains that demand remains highly concentrated and lacks consistent external drivers. The current usage pattern remains far from displacing traditional banking functions.

Despite the growing number of stablecoins, JPMorgan highlights their utility primarily within digital asset platforms. Usage outside crypto exchanges or blockchain protocols remains limited, with few signs of changing quickly. The report emphasizes that real-world payment adoption remains modest.

JPMorgan Doubts Stablecoins Will Replace Banks

JPMorgan’s analysts reject claims that stablecoins can replace bank deposits or money market funds in the near term. They argue that stablecoins currently offer insufficient yield and involve costly on-off ramps to fiat currency. This limits their appeal for average consumers and traditional investors.

The report also dismisses comparisons with China’s e-CNY or digital wallets like Alipay and WeChat Pay. These systems operate under centralized, state-controlled frameworks unlike decentralized stablecoins. Therefore, JPMorgan does not view them as realistic growth templates for stablecoins.

JPMorgan emphasizes that cross-border transfers still involve operational complexity and friction. As a result, stablecoins are unlikely to scale into widespread payment tools without further infrastructure. The bank asserts that today’s use cases are not enough to justify trillion-dollar market predictions.

Others See a Much Bigger Future

While JPMorgan remains conservative, Standard Chartered has issued a sharply higher growth forecast for the stablecoin sector. They believe new U.S. regulations could propel stablecoin supply by ten times over the next few years. Their projections suggest a potential market size of $2 trillion by 2028.

Standard Chartered attributes this to anticipated legal clarity from the proposed Genius Act and related legislation. They argue that improved regulation would reduce institutional hesitation and boost adoption, directly contrasting JPMorgan’s more cautious projection.

For now, JPMorgan holds that real-world adoption and payment utility are not growing fast enough. Although the stablecoin market is expanding, JPMorgan anticipates steady progress rather than explosive growth. Regulatory developments will remain key to shaping its trajectory.

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