Circle's stablecoin sector is experiencing 40% growth, and the company doesn't see banks as rivals

Jeremy Allaire, Circle's CEO, described a 40% compound annual growth rate as a "reasonable baseline."

He noted that banks have advanced from initial trials to widespread implementation.

Allaire dismissed the idea that banks or payment companies pose a threat.

Circle CEO Jeremy Allaire also anticipates a 40% compound annual growth rate as a "reasonable baseline" for the stablecoin market.

The stablecoin sector, Allaire explained to CNBC Squawk Box at Davos on Thursday, is at a turning point, with institutional adoption shifting from pilot programs to full-scale deployments across the financial landscape.

Allaire noted a significant shift in how traditional banks are approaching stablecoins. "Banks have progressed from testing to real-world deployment," he stated, pointing to major financial players integrating stablecoins into their payment and treasury operations.

Circle believes payment providers and banks can coexist. Allaire explained that Circle doesn't see banks or payment processors as competitors within the stablecoin space. He likened Circle's function to constructing neutral infrastructure, enabling institutions to improve their offerings without directly competing with them. This positions USDC as a utility layer, accessible to banks, payment processors, and fintech companies without Circle vying for their customers.


Allaire's projection of 40% growth underscores the stablecoin sector's current momentum and its inherent advantages over traditional payment systems. He pointed to the increasing need for quick settlement, constant availability, and the programmability of money features that existing systems struggle to provide.

The stablecoin market, now valued at $300 billion, has expanded due to applications in cross-border payments, decentralized finance, and corporate treasury management.

Circle's positive outlook implies that legal clarity and institutional adoption will continue to bolster the stablecoin ecosystem through 2026 and beyond.