Stablecoins might not be crypto’s sexiest asset, but they’re going through a metamorphosis.
They’re at the centre of a global arms race of banks, tech firms, and governments vying for their slice of a quarter-trillion-dollar pie. And that number is growing every day.
Ant Group — backed by Jack Ma, once China’s richest man — is gearing up to join the party. It began as Alibaba’s payments arm and still handles transactions for its e-commerce empire.
Now, the fintech giant’s Ant International arm is reportedly preparing to apply for stablecoin licences in Hong Kong, Singapore, and Luxembourg, according to Bloomberg sources.
If approved, the licences will allow Ant to issue its own regulated stablecoins for use in cross-border payments and treasury operations.
While Ant International is Singapore-based, its parent firm, Ant Group, is owned by mainland Chinese stakeholders, making its stablecoin ambitions stand out given China’s historically ambiguous-but-restrictive crypto policies.
Ant International didn’t immediately return a request for comment.
Stablecoin summer
The timing couldn’t be better.
The stablecoin market just hit an all-time high of over $250 billion in circulation, fuelled by a growing institutional demand and a global push toward clearer rules.
“Packing my bags for stablecoin summer”, tweeted Ryan Sean Adams, crypto investor and founder of Bankless, the crypto podcast.
Asia, the US, and Europe are racing to legally define how this digital money should be issued, governed, and taxed.
And if favourable regulations fall into place, some analysts believe that $250 billion could be just the beginning.
Analysts at Standard Chartered forecast the market could grow to $2 trillion by 2028.
Bitwise CIO Matt Hougan sees the path as even faster, projecting a 10-fold surge to $2.5 trillion “in no time.”
Meanwhile, Citigroup analysts believe stablecoins could hit $3.7 trillion within five years, more than the current size of the entire crypto market.
Much of that growth, however, hinges on how the US handles the Genius Act, a stablecoin bill that cleared a key Senate hurdle this week
“It feels like quite a moment in the development and history of stablecoins and banking,” William Emmons, a former economist at the St. Louis Federal Reserve, told the Financial Times.
Circle rises, Tether expands
For the time being, the stablecoin market is a two-horse race, with Tether’s USDT and Circle’s USDC making up over 86% of the entire supply.
Circle took a big step last week with its IPO on the New York Stock Exchange, sending shares soaring and bolstering its image as the go-to stablecoin for regulated institutions.
Circle’s USDC market cap sits just above $60 billion, trailing USDT’s $156 billion.
Meanwhile, top dog Tether is backing a new blockchain called Stable, which will allow USDT to be used for transaction fees and target financial institutions with high-speed “enterprise lanes.”
Even the Trump family is getting in on the action. Their affiliated project, World Liberty Financial, recently borrowed $7.5 million in USDT to boost USD1, a self-branded stablecoin pitched at sovereign investors and institutional players.
Crypto market movers
Bitcoin lost 2.2% in value over the past 24 hours and is trading at $106,950.
Ethereum is down 2.1% over the same period to $2,720.
What we’re reading
Alleged crypto torturers plead not guilty after indictment on kidnapping, assault charges unsealed in New York ― DL News
Ailing Fitness Company on Nasdaq Turns to a $500 Million AI Crypto Token Treasury Strategy ― Unchained
The next $1B memecoin is… — Milk Road
Saylor’s play for $100tn corporate bond market is ‘complete financial gibberish,’ says legendary short seller ― DL News
Kyle Baird is DL News’ Weekend Editor. Got a tip? Email at [email protected].
