Global Stablecoin Market Reaches $280 Billion, Regulators Issue Warning?

Jakarta, Pintu News – The global stablecoin market has reached a combined market capitalization value of $280 billion, setting a new record that has caught the attention of financial regulators around the world.

Warning from the European Central Bank

The European Central Bank (ECB) has issued a warning about the systemic risks that the growing stablecoin sector may pose. The ECB stated that these digital assets could disrupt the financial system by attracting retail deposits from banks in the Eurozone.

In the event of a sudden withdrawal of funds on stablecoins, this could trigger a massive sell-off of reserve assets that could disrupt the US Treasury market and trigger a financial crisis in the absence of coordinated global regulation.

The ECB highlighted several structural weaknesses in its assessment, including the risk of losing grip with the underlying currency, withdrawal dynamics similar to traditional bank withdrawals, and growing connections with the conventional financial system.

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Stablecoin Usage and Adoption

Stablecoins are commonly used for cryptocurrency trading, with most transactions on centralized exchanges made using these digital assets. However, retail adoption for payments in the real economy remains limited, according to industry data. Financial stability concerns center on the asset-backed reserve model used by major issuers.

The reserves held by major stablecoin issuers are comparable to large global money market funds and include substantial holdings of US Treasury securities, making these issuers important participants in the short-term Treasury market.

In the event of a sudden withdrawal of funds on stablecoins, this could force a rapid liquidation of government securities and put pressure on the Treasury market, with risks increasing as the market expands, according to the central bank report.

Read also: Japan’s New Regulations: FSA Requires Crypto Exchanges to Have Liability Reserves

Regulatory Response and MiCA Framework

The growth of the sector has been influenced by regulatory developments, including the full implementation of the Markets in Crypto-Assets (MiCA) regulation in the European Union and recent legislative proposals in the United States. Hong Kong has also advanced its stablecoin regulatory framework.

The MiCA framework addresses some of these concerns in Europe by prohibiting interest payments on stablecoin holdings, although similar measures are still the subject of debate in other jurisdictions.

Cross-border regulatory inconsistencies create opportunities for arbitrage, making global coordination through forums such as the G20, Financial Stability Board, and Basel Committee standards necessary to address the systemic threat of stablecoin growth, according to policymakers.

Conclusion

With increasing market capitalization and a growing role in the global financial system, stablecoins continue to attract attention and concern from financial regulators. Strict regulatory measures and international coordination will be key to ensuring that the growth of the sector does not pose greater systemic risks.

FAQ

What are stablecoins?

Stablecoins are a type of crypto asset whose exchange rate is linked to other stable assets such as fiat currencies or gold to reduce volatility.

Why is the ECB worried about stablecoins?

The ECB is concerned that stablecoins could disrupt the financial system by withdrawing deposits from banks in the eurozone and triggering massive sales of reserve assets.

What is the MiCA framework?

The Markets in Crypto-Assets (MiCA) framework is a regulation implemented in the European Union to regulate crypto-asset markets, including stablecoins, to enhance investor protection and financial stability.

What is the current global market capitalization of stablecoins?

The global market capitalization for stablecoins has now reached $280 billion.

What is the impact of sudden withdrawals on stablecoins?

A sudden withdrawal of funds on stablecoins could trigger a rapid liquidation of government securities and put pressure on the Treasury market, increasing the risk of a financial crisis.

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Reference

• Crypto News. Global Stablecoin Market Hits $280B as Regulators Warn of Risks. Accessed on November 26, 2025
• Featured Image: Unchained Crypto