Bernstein’s report on Stablecoins as CBSM

Shruti Govil
Shruti Govil April 9, 2024
Updated 2024/04/09 at 1:49 PM

In a research study, broker Bernstein observed that the stablecoin market was growing and that consumer platforms, fintech companies, and payments companies were among the early adopters of these cryptocurrencies. Cross-border transactions are made with these coins.


tether (USDT) and USD Coin (USDC) controlling the market with shares of 75% and 22%, respectively, Bernstein reports that the supply of stablecoins is currently $150 billion. While other currencies and assets, including gold, are also utilized, stablecoins are a particular kind of cryptocurrency that are typically correlated to the US dollar.


What do the authors of the report say?

“Q1 2024 annualized value transferred stands at $6.8 trillion, equivalent to 2022 high of ~$7 trillion,”

analysts Gautam Chhugani and Mahika Sapra wrote.

They added,

“The stablecoin value settled on the blockchain indicates strong adoption of the digital dollar with the crypto trading ecosystem as a cross-border payments currency.”

The authors claimed that consumer fintech platforms like Grab (GRAB) in Singapore and Mercado Libre (MELI) in Latin America, as well as payment companies like Paypal (PYPL) and Visa (V), have shown indications of adopting stablecoins. The paper claimed that although Solana is leading the way in blockchain payments, it has scalability problems.

“Compared to previous cycle market leader Ethereum, the biggest shift this cycle has been Solana’s dominant market share (43% highest share) in the value of transferred stablecoins.”

Although Solana is working on pilot projects with Shopify and Visa, the letter stated that a significant increase in scalability would be necessary for the blockchain to become a viable payment method for consumers and businesses.


Why are stablecoins useful for crypto?

Bitcoin and ether are two examples of cryptocurrencies that have many advantages, including the ability to send money to anybody, anywhere, without needing to trust a middleman. One significant disadvantage, though, is that the prices of cryptocurrencies tend to vary, often dramatically.

For regular people, this makes them difficult to utilize. For both their security and their livelihood, most people anticipate being able to determine how much their money will be worth in a week.

The unpredictable nature of cryptocurrencies contrasts with the typically steady values of traditional assets like gold or fiat money like US dollars. While currencies such as the dollar do see modest fluctuations in value over time, the daily fluctuations in the value of cryptocurrencies are frequently more severe.

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