Bank of America (BofA) expects a significant rise in stablecoin supply and adoption as U.S. banks move toward issuance, driven by new regulatory clarity and growing demand for tokenized finance.
Bank of America has indicated that several major financial institutions are preparing to introduce stablecoins, buoyed by a surge in regulatory support and increased interest in tokenized finance. In a recent report, the bank projects stablecoin supply could grow by as much as $75 billion in the near term, signaling growing institutional momentum behind blockchain-based digital assets.
Analysts predict the legislation will encourage more U.S. banks to either serve or directly issue stablecoins. The report also highlighted that banks are considering consortium-led models for this move, reflecting a coordinated approach toward their deployment.
The passage of the GENIUS Act, signed into law by President Donald Trump last week, has been identified as a critical turning point for stablecoin regulation in the U.S. The legislation provides clearer rules for the issuance and management of stablecoins, streamlining their role within the broader financial system. Bank of America noted that the regulatory environment has become increasingly favorable, prompting both new product rollouts and infrastructure investments.
While the GENIUS Act is expected to lay the foundation for further development in tokenized finance, this trend will likely be accelerated by the proposed CLARITY Act, which aims to establish a comprehensive regulatory framework by distinguishing digital assets as either securities or commodities. The bill has passed the House of Representatives and is awaiting consideration in the Senate.
With stablecoins typically backed by U.S. dollar reserves or equivalents, Bank of America expects demand for short-term U.S. Treasuries to rise in tandem with the growth of these digital assets. The bank suggested this demand could influence Treasury Department issuance strategies, particularly by shifting focus toward short-term bills to meet reserve needs.
Currently, the total stablecoin market capitalization stands at approximately $270 billion, according to CoinMarketCap. Bank of America projects a “modest” increase of $25-$75 billion in the short term, driven by competition from tokenized deposits and money market funds.
The report also underscored a shift in sentiment among traditional banking giants. JPMorgan Chase, led by longtime crypto skeptic Jamie Dimon, has begun developing crypto products and exploring Bitcoin exposure, marking a significant departure from its earlier stance.
Despite the enthusiasm, most banks do not foresee immediate disruption to domestic payment systems. Instead, they view stablecoins as a complement to existing structures, particularly valuable in cross-border transactions and alternative asset storage.
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