Skadden Insights 2026 - Flipbook - Page 2
STABLECOIN
K EY ME TR ICS
INSIGHTS
250+
There were more than 250
stablecoin issuers as of mid2025.
Source: Financial Act ion Task Force
80%
The stablecoin market could reach trillions of dollars in the next few years,
creating both opportunities and risks for banks.
Two providers, Tether and Circle,
control more than 80% of the
stablecoin market right now.
Source: CoinMarketCap
To Michael Reed, a partner at the law firm Skadden, Arps, Slate,
KEY TAKEAWAYS
Meagher & Flom, bankers are taking too much of a blasé approach to
stablecoins. “When they would get around to this topic, they’re like,
• The market for stablecoins is projected to
grow from $324 billion in May to as much as
$4 trillion by 2030.
• The increased adoption of stablecoins could
mean that as much as $6.6 trillion in deposits
could leave the traditional banking sector as
a result. That could negatively impact banks’
ability to make loans.
• Midsize and community banks are at a distinct
competitive disadvantage. There are a small
number of digital asset firms that issue the
majority of stablecoins and only a few money
center and specialty banks that hold the cash
reserves and Treasuries that back them.
• Still, smaller banks should have future
opportunities to benefit from stablecoin. For
instance, they could partner with stablecoin
providers to offer cash reserve or Treasury
custodial services to them.
‘Oh yeah, stablecoin, we’ll see what happens,’” he says. “My response
is ‘What do you mean — and see what happens?’”
This approach may not be taking into account the significant impact
stablecoins could have on the financial services industry. Stablecoins
already have a market capitalization of $324 billion. Citigroup estimates that amount will grow to at least $1.9 trillion and potentially up
to $4 trillion by 2030. While the Financial Action Task Force estimates there were more than 250 types of stablecoins in circulation as
of mid-2025, just two, Tether Operations Limited’s USDT and Circle
Internet Group’s USDC, account for more than 80% of the market.
Those coins are backed primarily by short-term Treasuries and cash
reserves held by crypto companies and a small number of banks.
While that means the stablecoin market is very concentrated at the
moment, Reed, who specializes in working with financial institutions and
fintechs, says he consistently tells bankers it won’t always be that way.
“You should think about it from a balance sheet mix perspective,” he says.
“Because this is going to hit quickly once it happens, and it is a great opportunity to make fee income for basically doing what you do every day.”
A Competitive Disadvantage
To date, much of the stablecoin discussion among bankers has
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