Stablecoin Usage Growth Is Outpacing Market Capitalization Expansion — JPMorgan

The popularity of stablecoins continues to grow steadily, but this trend does not necessarily imply a proportional increase in their total market capitalization. This was reported by The Block, citing analysts from JPMorgan.

According to the bank’s report, transaction volumes are rising faster than capitalization due to increasing token velocity — the frequency with which the same tokens circulate between users. The more efficient stablecoin‑based payment systems become, the higher this turnover rate grows: larger transaction volumes can be supported by a smaller issuance supply.

Stablecoin velocity dynamics. Source: The Block, JPMorgan

“The broader the adoption of stablecoin payment systems, the greater their efficiency and turnover speed,” analysts explained. “This will likely limit overall stablecoin market expansion, even if payment usage increases significantly.”

Currently, peer‑to‑peer transfers still dominate transaction activity, though payments to businesses and merchants are expanding more rapidly. Asia remains the leading region in terms of stablecoin usage volume.

Regional share of stablecoin transaction activity. Source: a16z crypto

From “Stablecoins” to Financial Infrastructure

Stablecoin adoption in payment systems accelerated following the passage of the U.S. $GENIUS Act — the first comprehensive regulatory framework for the industry.

Against this backdrop, perceptions of the nature of stablecoins themselves are evolving.

Growth in stablecoin transfer volume following passage of the $GENIUS Act. Source: a16z crypto

In an analytical report published by a16z crypto, researchers argue that the term “stablecoin” may be becoming outdated. Originally coined during periods of extreme market volatility, the term emphasized the defining feature of price stability. Today, stability has become a baseline expectation rather than a distinguishing characteristic.

Stablecoins now enable instant cross‑border transfers, real‑time settlements, and seamless integration into digital applications in ways that traditional money cannot replicate.

“The question is no longer whether the asset can preserve value — it is what can be built on top of it,” the report’s authors wrote.

In their view, stablecoin technology is gradually evolving into foundational infrastructure for a new financial system and may eventually become so embedded that it loses its distinct label — much like “electric lighting” eventually became simply “light.”

Other analysts have suggested a similar trajectory, proposing that stablecoins could ultimately serve as the backbone of global payment infrastructure.

See also: "Santiment: Dogecoin Whale Activity Reaches a Six‑Month High"

#Capitalization #Stablecoins #JPMorgan #GENIUS Act

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