The stablecoin market is experiencing unprecedented growth and transformation in 2025.
As of July 2025, total stablecoin capitalization has surpassed $260 billion up from $20 billion in 2020, with transaction volumes now outpacing traditional payment networks like Visa and Mastercard. Stablecoins are digital assets pegged to stable reserves such as the U.S. dollar, have evolved from niche tools for crypto traders into essential infrastructure for global payments, remittances, and business operations.
This rapid expansion coincides with a landmark development in U.S. policy. On July 17, 2025, the U.S. Congress passed the GENIUS Act, a sweeping stablecoin regulation bill now awaiting President Donald Trump’s signature. Once signed, the Act will impose stricter reserve requirements, ban yield offerings, and create a dual federal-state licensing system for issuers. These changes are poised to reshape how stablecoins operate in the world’s largest economy—and influence global adoption trends.
According to Delphi Digital, more than 10 stablecoins currently have circulating supplies exceeding $1 billion, with Tether (USDT) and Circle's USD Coin (USDC) still dominating 86% of total issuance. Over 161 million people worldwide now hold stablecoins, and more than 80% of crypto-aware SMBs are exploring their use for payments and treasury management. This rapid adoption is occurring alongside a surge in institutional trading, as stablecoins now account for nearly three-quarters of all spot crypto trades.
Source: Delphi Digital on X
Against this backdrop of record growth and mainstream acceptance, the U.S. Senate passed the GENIUS Act on June 18, 2025, a landmark bill that introduces a comprehensive regulatory framework for stablecoin issuers. As legislation moves closer to becoming law, the stage is set for stablecoins to play an even larger role in the future of finance.
Source: Social Capital Markets
What Is a Stablecoin?
A stablecoin is a form of cryptocurrency engineered to keep its value steady compared to a particular asset or a group of assets. While cryptocurrencies like Bitcoin and Ethereum are known for their price swings, stablecoins are intended to provide consistency and predictability, making them especially useful for trading, saving, and various financial operations. Stablecoins are digital tokens pegged to fiat currencies like the US dollar, which are essential in the decentralized finance (DeFi) space.
Why Are Stablecoins Rising in Popularity in 2025?
Stablecoins have become one of the fastest-growing segments in the crypto market, and 2025 marks a defining moment for their adoption. With total market capitalization soaring past $255 billion, these dollar-pegged digital assets have evolved beyond being a niche tool for crypto traders to reshape global payments, finance, and even monetary policy.
From institutional giants like JPMorgan launching their own stablecoins to millions of individuals in high-inflation economies turning to USDT and USDC as a safe haven, the demand for stablecoins reflects a shift toward digital dollars in everyday use. Surging transaction volumes, expanding real-world applications, and the promise of upcoming regulations are accelerating this trend, positioning stablecoins at the heart of crypto's next growth phase.
As the mainstream settlement layer in crypto trading, you can easily trade USDT, USDC, and other major stablecoins on BingX. You could also easily swap USDC/USDT spot trading pair on BingX.
Stablecoin Market Cap Crosses $255 Billion
Total stablecoin market cap | Source: DefiLlama
The stablecoin market has reached a new all-time high with total capitalization now standing above $255 billion as of July 2025. This figure represents a dramatic increase from the $172.8 billion recorded in September 2024, reflecting a 46% growth in less than a year. The overall cryptocurrency market currently sits at $3.35 trillion, with stablecoins accounting for 7.6% of the total market value. Tether (USDT) dominates the sector, holding over $139 billion in market value and representing more than 55% of the stablecoin market. Circle's USDC follows with nearly $41 billion, while DAI, the third-largest, is held by just over 505,000 crypto wallets. The top 10 stablecoins by market capitalization collectively have 8.7 million holders, with USDT alone held by over 5.8 million wallets.
Use Case Index for Stablecoins| Source: Chainalysis
The number of addresses holding stablecoins has reached 121.67 million as of September 2024, up from 105.55 million earlier in the year. Of these, 19.70 million addresses were actively engaging with stablecoins in September. USDT is the most widely held stablecoin, with on-chain wallet adoption exceeding 109 million by Q4 2024. Stablecoin transaction volume has reached unprecedented levels with $27.6 trillion transferred in 2024. This volume surpassed the combined transaction totals of Visa and Mastercard, highlighting stablecoins' growing role in global payments. In May 2025, Ethereum's Layer-1 recorded $480 billion in stablecoin volume, demonstrating the asset class's operational scale.
Wallstreet's Institutional Participation in Stablecoin Growth and Market Expansion
Major financial institutions are rapidly advancing stablecoin initiatives ahead of expected federal regulation, with over a dozen global banks and fintechs, including JPMorgan, Bank of America, and Citigroup filing for licenses or announcing upcoming launches. These stablecoins aim to support diverse use cases such as international payroll, trade finance, retail payments, and tokenized settlements, reflecting the growing role of stablecoins in global finance as transaction volumes surpassed $27 trillion in 2024.
Trading volume for stablecoins compared to Visa and Mastercard in 2024 Source: CEX.IO
This surge highlights traditional finance's strategic move to integrate digital assets and reshape payment infrastructure. These stablecoins such as USDT and USDC target use cases that include international payroll, trade finance, retail payments, and tokenized settlements. The rapid expansion of stablecoin usage is also evident in regions with fragile financial systems and high inflation, where stablecoins provide a means to preserve value and access dollar-pegged assets.
Source: Fireblocks
What Is the GENIUS Act in the U.S.?
Source: Fireblocks
On July 17, 2025, the U.S. House of Representatives passed the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act), sending it to President Donald Trump for signature. The bill had previously cleared the Senate on June 18, 2025, and Trump is expected to sign it into law during a signing ceremony on July 18, 2025.
The GENIUS Act creates a comprehensive federal framework for the issuance and regulation of stablecoins—digital tokens pegged to assets like the U.S. dollar or short-term Treasury bills. Once enacted, the law will take effect 18 months after signing, or 120 days after U.S. regulators issue final implementation rules.
Key provisions include:
• Full 1:1 reserve backing: Issuers must hold liquid assets such as U.S. dollars and Treasury bills equal to their outstanding stablecoin supply.
• Monthly reserve disclosures: Issuers must publish detailed reports of reserve composition, verified by registered public accounting firms.
• Interest/yield ban: Issuers are prohibited from paying interest or offering yield on stablecoin holdings.
• Approved issuer requirement: Only federally or state-approved issuers can offer stablecoins in the U.S. market after a three-year transition period.
• Foreign stablecoin carve-outs: Foreign issuers may serve U.S. customers if their home country has comparable regulations and they register with U.S. authorities.
The Act also authorizes multiple regulators, including the Federal Reserve, Treasury, OCC, FDIC, and state agencies, to oversee different categories of issuers. Smaller issuers under $10 billion in circulation can choose state-level regulation if states establish a stablecoin regulator.
Experts warn the law leaves significant uncertainty for DeFi platforms and decentralized protocols that use stablecoins, with further legislation expected to address these gaps.
GENIUS Act Establishes Federal Stablecoin Framework
The GENIUS Act’s passage marks a historic step for the U.S. digital asset industry. Backed by a bipartisan vote of 308–122 in the House, it reflects growing political support for establishing clear rules around stablecoins.
The legislation requires issuers to obtain federal or state approval and comply with strict operational and transparency standards. Many issuers are now expected to seek national trust bank charters to streamline operations across all U.S. states, bypassing individual state money transmission licenses.
Industry leaders see the Act as a foundation for broader institutional participation, while critics point to potential challenges for innovation and DeFi integration. The law’s ban on yield-bearing stablecoins is particularly controversial, as it removes a key feature used by platforms to attract users.
What is Crypto Week and Why is It Monumental for Stablecoins?
What happens when Wall Street, Washington, and Silicon Valley unite behind digital assets? The U.S. House of Representatives is set to vote this week on the Guiding and Establishing National Innovation for U.S. Stablecoins, better known as the GENIUS Act, is part of what lawmakers are calling "Crypto Week." This landmark legislation, which has already passed the Senate with strong bipartisan support, aims to establish the first comprehensive federal regulations for the stablecoin market. Lawmakers hope that the U.S. House of Representatives' approval will send the GENIUS Act straight to President Trump's desk for final signature, potentially marking a historic turning point for digital asset regulation in the United States.
This is the first time Congress has moved to establish clear federal guardrails for U.S. dollar-pegged stablecoins, a sector that has exploded to a market cap of about $238 billion and is now driving trillions in transaction volume annually. The GENIUS Act will require stablecoins to be 100% backed by reserves, undergo monthly audits, and follow anti-money laundering laws. This sets the stage for banks, fintech firms, and even major retailers to confidently issue their own digital dollars with federal backing.
CNBC reports that the digital asset industry invested roughly $250 million into the 2024 election cycle, helping install the most crypto-forward Congress in U.S. history. Stablecoins also took the spotlight at this year's Bitcoin 2025, one of the largest crypto conferences worldwide where U.S. officials repeatedly emphasized that digital dollars bolster the dominance of the U.S. dollar on the world stage. Vice President JD Vance even declared stablecoins key to strengthening the nation's economic future, and administration officials revealed that demand for such assets could unlock trillions in global purchases of U.S. Treasuries.
In addition to the GENIUS Act, the House of Representatives will take up two other major crypto bills during Crypto Week. The Digital Asset Market Clarity Act aims to define clear roles for the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) in regulating digital tokens, establishing a comprehensive framework for how digital assets are overseen and classified. Meanwhile, the Anti-CBDC Surveillance State Act would prohibit the Federal Reserve from creating or issuing a digital U.S. dollar, ensuring that any move toward a central bank digital currency would not proceed. These legislative efforts are central to shaping the future of crypto regulation in the United States and will determine how digital assets are governed.
With the U.S. stablecoin market projected by policymakers to soar past $2 trillion in coming years, Crypto Week is more than a series of policy debates. It's a pivotal moment that could cement the country's financial leadership worldwide.
The U.S. House of Representatives Advances Landmark Crypto Bills After Lengthy Procedural Vote During Crypto Week
The U.S. House of Representatives is the lower chamber of the United States Congress responsible for introducing and voting on federal legislation, including the recent key cryptocurrency bills mentioned above during "Crypto Week" in July 2025. This House is composed of elected officials representing congressional districts from all 50 states and plays a central role in shaping U.S. law and policy.
During Crypto Week, the U.S. House of Representatives made significant progress on landmark crypto bills after a procedural vote failed 196-223 on Tuesday, July 15, 2025 due to opposition from some Republicans, the party regrouped the next day.
According to CoinDesk, Wednesday July 16's vote cleared the way for final votes on the CLARITY and GENIUS Acts. The first procedural motion passed narrowly (217-215), signaling smooth approval ahead. A second, longer 10 hour voting process faced initial GOP opposition but ultimately passed 217-212, advancing the GENIUS and CLARITY Acts toward final consideration. This progress happened after President Trump's intervention and the addition of key anti-CBDC provisions to the must-pass National Defense Authorization Act.
Final votes on the GENIUS Act are scheduled for Thursday July 17, 2025, setting the stage for the first comprehensive U.S. crypto legislation to potentially reach the president's desk for signing shortly after.
GENIUS Act Establishes Federal Stablecoin Framework
The U.S. Senate has approved the GENIUS Act with a bipartisan vote of 68–30, marking a pivotal legislative milestone for the stablecoin sector. This act is designed to create the first comprehensive federal regulatory framework for payment stablecoins in the United States, establishing clear standards for issuers and providing a foundation for further innovation in digital finance.
The GENIUS Act advanced to the House of Representatives, where it's considered alongside the STABLE Act and broader market structure legislation. If enacted, the GENIUS Act will require stablecoin issuers to obtain federal or state approval, adhere to strict reserve requirements, and comply with operational and transparency standards.
The legislation will permit both licensed entities and federally chartered banks to issue stablecoins, facilitating large-scale participation from major financial institutions. Treasury Secretary Scott Bessent has described the bill as a landmark step for responsible innovation, reflecting the sentiment of both policymakers and industry leaders who view this framework as critical for the future of digital dollar adoption. The GENIUS Act's passage in the Senate signals broad political support for stablecoin regulation and is expected to accelerate institutional entry and product development across the digital asset market.
Stablecoin Market Outlook and Projections
Source: Outlier
The passage of the GENIUS Act in Congress signals a new era for stablecoins as they move from lightly regulated instruments to fully integrated components of financial systems. JPMorgan projects the stablecoin market could reach $500 billion by 2028, with some analysts suggesting it could approach $1 trillion if global regulatory clarity accelerates adoption.
Can Stablecoins Serve as Financial Infrastructure?
Source: Fireblocks
The law is expected to drive consolidation in the market, favoring issuers that can meet stringent U.S. requirements such as full reserve backing and monthly disclosures. Meanwhile, the ban on yield-bearing stablecoins may lead to a decline in certain products but could also encourage innovation in compliant alternatives.
As stablecoins become deeply embedded in the global financial system, with over $120 billion of reserves now held in short-term U.S. Treasuries, they are increasingly viewed as a backbone for payments, remittances, and DeFi protocols. However, risks remain around regulatory arbitrage, concentration among a few issuers, and operational adjustments as the new U.S. framework comes into effect.
Investors and institutions should closely monitor the rollout of the GENIUS Act over the next 18 months as it will set the tone for stablecoin use in mainstream finance and potentially redefine cross-border digital dollar flows.
Read more: What Is the U.S. Crypto Week 2025 and How Could It Impact Bitcoin, Stablecoins, and Altcoins?