Core Viewpoint - The stablecoin market is entering a new expansion cycle, with potential scale reaching trillions of dollars, driven primarily by the payments sector [1][3]. Market Size and Growth Potential - The global stablecoin market currently stands at $271 billion, with Circle's USDC expected to benefit from legislative advancements and ecosystem expansion [1]. - By the end of 2027, USDC's market size is projected to grow by $77 billion, achieving a compound annual growth rate (CAGR) of 40% [1]. Payment Sector Insights - The global payments market is approximately $240 trillion annually, with consumer payments accounting for $40 trillion and B2B payments around $600 billion [3]. - The penetration of stablecoins in payment scenarios is seen as a core growth driver, despite current applications being dominated by cryptocurrency trading and offshore dollar demand [3]. Regulatory Environment and Market Dynamics - The issuance of stablecoins requires a 1:1 reserve of dollars or government bonds, which could structurally impact the bond market, particularly short-term low-interest government bonds [4]. - The recent passage of the GENIUS Act by the U.S. White House provides crucial institutional support for the stablecoin market [4]. - Tether's USDT remains the leading stablecoin, but regulatory limitations prevent it from directly serving U.S. users, while Circle aims to leverage new legislative benefits to expand USDC's adoption [4]. Competitive Landscape - Traditional financial institutions, such as U.S. banks, are planning to issue their own dollar-backed stablecoins, which may intensify competition for USDC's growth [4]. - Tether's CEO has indicated plans to strategize entry into the U.S. market, aiming to overcome current regulatory barriers [4]. Market Outlook and Diverging Opinions - U.S. Treasury Secretary Scott Basset expresses optimism about the stablecoin market, suggesting a $2 trillion market size is a "very reasonable target," potentially exceeding this figure [5]. - However, some analysts, including those from UBS, caution that stablecoins may represent a conversion of funds rather than net demand growth, highlighting a divergence in market perspectives on the actual impact of stablecoins [5].