JPMorgan: The widespread adoption of stablecoins is expected to boost demand for the US dollar

Jinse Finance reported that JPMorgan stated the global adoption of stablecoins could drive trillions of dollars into the US dollar over the next few years, even though there is significant divergence in market estimates of potential demand for this digital asset. “The adoption of stablecoins is more likely to reinforce the US dollar’s position in the global financial system rather than accelerate de-dollarization,” JPMorgan’s team, including Kunj Padh, Meera Chandan, and Octavia Popescu, said in a report on Tuesday. Bank strategists have widely varying estimates for the eventual size of the stablecoin market, even within JPMorgan itself. The emerging markets equity strategy team expects the market to eventually expand to about 2 trillion dollars. The bank’s US rates strategists are more cautious, estimating a size of around 500 billion dollars. According to the upper end of this range, JPMorgan’s FX strategists estimate that by 2027, approximately 1.4 trillion dollars in additional US dollar demand will support the growth of the stablecoin market. This is a large figure, but still far below the latest statistics from the Bank for International Settlements, which show an average daily trading volume of 8.6 trillion dollars for US dollar currency pairs.