Goldman Sachs Declares This the ’Summer of Stablecoins’ - Is Traditional Finance About to Be Upended?

Wall Street's waking up to the stablecoin revolution—and they're not just watching from the sidelines.

Goldman Sachs dubs this the 'summer of stablecoins' as institutional adoption hits unprecedented levels. Traditional finance giants finally recognize what crypto natives knew years ago: dollar-pegged digital assets aren't just for trading—they're rebuilding the financial stack from the ground up.

Stablecoins now process more daily volume than some major payment networks—bypassing legacy banking rails entirely. They settle cross-border payments in seconds instead of days, cutting out intermediary fees that have padded bank profits for decades.

Corporate treasuries increasingly allocate to stablecoins for yield generation and operational efficiency. The old guard either adapts or gets left behind—after all, why use a fax machine when instant messaging exists?

Regulators scramble to keep pace while traditional banks face their 'innovator's dilemma' moment. One cynical take? Banks love blockchain—as long as they control it and can still charge 3% for basic money movement.

The real question isn't whether stablecoins will upend finance—but how many legacy institutions will still be standing when the dust settles.

Key Takeaways

• The roughly $270 billion global stablecoins market stands to disrupt the traditional financial services industry, but to what degree remains an "open question," according to a recent Goldman Sachs report.
• Goldman analysts say that concerns about the potential disintermediation of companies that provide payment and remittance services are overdone.
• The firm sees Circle's USDC taking greater share of the stablecoin market at the expense of Tether's offshore USDT.

The first federal regulatory system signed into law brought about something of a summer awakening for stablecoins. Whether the roughly $270 billion global market in tokens pegged to real-world currencies will grow to trillions, and eat into traditional financial services industries, remains to be seen.

Stablecoins, now predominantly used for crypto trading and for dollar access outside of the U.S., have been prophesied to replace and modernize legacy systems with blockchain efficiency. However, total disruption is unlikely, Goldman Sachs Research said in a report published Tuesday.

Analysts including Will Nance and James Yaro wrote that stablecoin benefits will accrue to the infrastructure LAYER of the financial sector, particularly in interbank payments, as well as settlements in capital markets, complex, and cross-border transactions. However, they see "limited threats" to payments services, including the consumer card ecosystem, and that their collective underperformance presents an opportunity to buy. Visa (V) and Mastercard (MA) are less rivals and more"likely to play a large role in facilitating stablecoin payments at scale in a consumer context," the report said.

Also, risk to remittance players, including Remitly (RELY) and Western Union (WU), are exaggerated, according to the report.

Goldman thinks GENIUS Act-compliant stablecoins such as Circle's (CRCL) USDC will take greater share at the expense of USDT, Tether's offshore stablecoin. The firm sees $77 billion of growth in USDC, or an estimated compound annual growth rate of 40% from 2024 to 2027. Tether's USDT is the world's largest stablecoin, with a $165 billion market cap, compared to Circle USDC's $66 billion, according to research platform rwa.xyz.

However, with Circle's elevated valuation after its blockbuster IPO earlier this year, Goldman favors Robinhood (HOOD) for its continued innovation in crypto.