Standard Chartered Says Faster Stablecoin Turnover Could Curb Demand

Standard Chartered analysts noted that stablecoin velocity has doubled over the last two years, driven by new payment use cases and increased traditional finance (TradFi) activity. Velocity, which measures how often stablecoins are used relative to their outstanding amount, means faster turnover can support higher transaction volumes without necessitating proportional supply growth. Head of crypto research, Geoff Kendrick, stated that if velocity increases, the demand for new stablecoins lessens, contrasting with earlier assumptions of stable velocity. This shift is attributed to stablecoins increasingly being used for higher-velocity TradFi replacement and AI-related transactions, while existing use cases like emerging market savings show no velocity increase. The velocity spike is primarily led by Circle's USDC across chains like Solana and Base, indicating a move toward TradFi use, whereas Tether's USDT maintains lower velocity, reflecting its strength in the lower-velocity emerging market savings sector. Despite these velocity dynamics, Standard Chartered maintains its forecast for the stablecoin market to reach $2 trillion by late 2028.

(Source：Cointelegraph)