Investment giant JPMorgan is approaching the Stablecoin Market with caution! Here are the 2028 predictions.

JPMorgan predicts that the stablecoin market will reach a size of 500 billion dollars by 2028. However, this estimate falls significantly short of optimistic expectations that argue the market capitalization could be between 1 to 2 trillion dollars during the same period.

JPMorgan: The Stablecoin Market Could Reach $500 Billion by 2028, But Expectations Are Overly Optimistic

In a report published on Thursday by a team led by JPMorgan strategist Nikolaos Panigirtzoglou, a more cautious growth scenario for the future of the sector was outlined.

According to the report, the main driving force behind the use of stablecoins is still crypto-native activities, and large-scale payment integration is still limited.

"The predictions that the stablecoin universe will reach 1-2 trillion dollars within a few years seem overly optimistic to us," the statements included.

According to JPMorgan, approximately 88% of the demand for stablecoins comes from in-crypto transactions such as spot and futures trading, DeFi collateral, and reserve assets of crypto companies. In contrast, payments only account for a 6% share.

The bank argues that even in the most optimistic scenario for the use of stablecoins for payment purposes, the market capitalization will show only a limited increase.

It also states that there is unlikely to be a large-scale capital shift from traditional bank deposits or money market funds to stablecoins. The reasons cited are their low returns and the difficulties encountered in transitioning between fiat currency and crypto.

Some institutions are much more optimistic than JPMorgan. For example, Standard Chartered predicts that if the GENIUS (Guiding and Establishing National Innovation for U.S. Stablecoins) Act, expected to be issued in the U.S., passes, the supply of stablecoins could increase tenfold by 2028, reaching 2 trillion dollars.

Standard Chartered, noting that this law will lend legitimacy to the sector, states that it could lead to a significant increase in the supply of US-based stablecoins.