The stablecoin market is about to change! CoinShares reports that the current stablecoin market size has exceeded $300 billion, with USDT accounting for 60% and USDC for 25%, forming a duopoly monopoly[1]. However, recently PayPal's PYUSD and JPMorgan's JPM Coin have been making strides, and the U.S. (GENIUS Act) requires compliant stablecoin issuers to hold U.S. Treasury reserves[1]. With this news, the landscape of the stablecoin market may be disrupted in 2026, but the 2 hidden risk points behind it are more deadly than you think!
First, let me explain: stablecoins are the 'blood' of the crypto world, and all transactions and transfers rely on them. Although the current duopoly structure is stable, there are still many issues, such as the constant questioning of USDT's reserve transparency. With the implementation of the (GENIUS Act) in 2026, the stablecoin market will become more compliant, but new risks will also emerge. Many people think that stablecoins are 'guaranteed profits,' but that is a big mistake; these two risk points must be vigilant next year!
First risk point: The Federal Reserve's interest rate cuts may lead to a decline in the earnings of stablecoin issuers, potentially triggering a "surge in issuance." CoinShares predicts that in 2026, the Federal Reserve will lower interest rates to around 3% [1]. The main source of income for stablecoin issuers comes from interest on reserve assets, and if interest rates decline, their earnings will significantly decrease. To maintain their current interest income, stablecoin issuers may issue a large number of stablecoins, leading to an oversupply of stablecoins in the market, which could trigger inflation and dilute your assets. How to respond? Try to choose stablecoins with high reserve transparency and stable issuance, such as USDC, and avoid holding small-scale or newly issued stablecoins.
Second risk point: The "liquidity crisis" triggered by competition among new stablecoins. In 2026, more institutions will definitely enter the stablecoin market, such as traditional banks and payment giants [1]. These new players will compete for market share through high yields and subsidies, which may lead to liquidity shortages for some small-scale stablecoins. If panic occurs in the market and investors rush to redeem, these stablecoins may experience "depegging," meaning their price deviates from $1. There have been instances of USDT briefly depegging, resulting in losses for many investors. How to respond: Do not put all your funds into one stablecoin; diversify by holding 2-3 mainstream stablecoins, and pay attention to the trading volume and reserve asset situation of stablecoins. If there is a sudden drop in trading volume or doubts about reserve assets, redeem promptly.
Let me reiterate my view: The "dual oligopoly" structure of the stablecoin market in 2026 is unlikely to be completely broken; USDT and USDC will still dominate due to their first-mover advantage and network effects [1]. New entrants like PYUSD and JPM Coin, although backed by institutions, will take a long time to shake the status of the dual oligopoly. However, with strengthened regulation, the stablecoin market will become more standardized, and those non-compliant, low-transparency stablecoins will be eliminated. This is a good thing for the entire crypto market, as it will reduce systemic risks.
Operational advice: When trading next year, prioritize using USDC and USDT, and try to avoid using unknown stablecoins. If you need to hold stablecoins for income, choose reputable platforms and be cautious about the reasonableness of the returns; if a stablecoin investment offers an annualized return exceeding 5%, be on high alert. Follow me @链上标哥 to avoid getting lost!
