What Regulation Means for Stablecoin Adoption

Stablecoins crossed $300 billion in circulation by mid-2025, and the passage of the US Genius Act gave the asset class a regulatory framework it never had before. For advisors, asset managers, and wealth managers, the question is no longer whether stablecoins matter—it's how much, to whom, and on what timeline.

Morningstar projects total stablecoins outstanding will reach $1.45 trillion by 2035, nearly five times current levels, but significantly below peer forecasts. That being said, the most immediate concern for financial professionals is what's happening inside bank balance sheets. A consumer shift from low-cost deposits towards stablecoin would raise banks' cost of funding, compress net interest income, and reduce valuations.

Morningstar's 'Financial Services Observer: Stablecoins' delivers a ground-up analysis of the stablecoin market, its realistic growth trajectory, and the measurable impact on bank funding costs, consumer payment networks, and remittance providers. Download the report to read our findings.