The financial landscape is on the cusp of a seismic shift as Bank of America projects that stablecoin regulations will catalyze unprecedented growth across major financial platforms. The banking giant’s latest analysis suggests that regulatory clarity surrounding digital assets will propel industry titans including Visa, Mastercard, JPMorgan, and Shopify toward broader adoption in payments and tokenized commerce, potentially reshaping how money moves through the global economy.
Bank of America estimates the stablecoin market could balloon from $250 billion to $2 trillion by 2028, representing one of the most significant transformations in modern finance. This projection comes at a pivotal moment when Congressional legislation appears imminent, with the bipartisan GENIUS Act gaining momentum in the Senate after invoking cloture in a 66–32 vote.
The scale of this transformation extends beyond mere market capitalization. Bank of America estimates that stablecoin supply could expand by $25 billion to $75 billion in the near term, fueled by institutional participation and legislative support. These figures reflect not just speculative investment, but genuine utility as stablecoins processed over $33 trillion in transactions in the past year, surpassing Visa.
Traditional payment processors are positioning themselves at the forefront of this digital revolution. Visa and Mastercard have already begun integrating stablecoin capabilities into their vast networks, recognizing the potential to capture new revenue streams while maintaining their dominant market positions. Mastercard partnered with Circle to enable USDC transactions on its 80 million merchant network, with stablecoin adoption potentially boosting its interchange fees by 15-20% as crypto-native users spend via traditional cards.
The appeal for these payment giants is clear. Stablecoins offer a potentially faster and cheaper form of payment over traditional banking rails including ACH and SWIFT, which are decades-old systems that typically take days to settle. This technological advantage addresses long-standing pain points in cross-border payments and instant settlement demands from modern commerce.
PayPal has emerged as another significant player, having processed $12B in crypto-related payments in 2024, with growth accelerating as stablecoins gain traction. The company’s early adoption of digital assets has positioned it to capitalize on the growing intersection between traditional payments and cryptocurrency infrastructure.
The most striking development in this emerging landscape is the enthusiastic participation of America’s largest banks. JPMorgan Chase, already operating its own JPM Coin for institutional clients, has doubled down on stablecoin initiatives. CEO Jamie Dimon recently confirmed that JPMorgan Chase was set to engage in both its deposit coin and other stablecoin efforts despite doubts about their utility.
Bank of America CEO Brian Moynihan has been equally bullish, confirming on July 16 that the bank has “done a lot of work” on issuing dollar-pegged tokens. While stopping short of providing a launch date, Moynihan’s comments signal serious institutional commitment to stablecoin technology.
The collaborative approach among major banks suggests a coordinated strategy to compete with existing digital asset platforms. America’s biggest banks are evaluating a collaborative stablecoin initiative, which could create a formidable challenger to current market leaders like Tether and Circle.
Citigroup has joined this institutional movement, with executives recently stating that the bank was “looking at the issuance of a Citi stablecoin”, further validating the sector’s potential for traditional financial institutions.
Beyond payments, the implications for tokenized commerce represent perhaps the most transformative aspect of this stablecoin boom. Companies like Shopify stand to benefit significantly as stablecoins enable new forms of programmable money and automated transactions. The integration of smart contracts with stable digital assets could revolutionize e-commerce by enabling instant settlement, automated escrow services, and micropayments for digital goods.
Bank of America’s analysis identifies four key market sectors positioned to benefit from this stablecoin expansion, though the specific details of these sectors highlight the broad-based nature of this technological shift. The bank’s research suggests that with a friendly legislative environment and increasing attention from traditional banks and payment companies, stablecoins could become a disruptive force across multiple industries.
The regulatory environment has undergone a dramatic shift, particularly following the 2024 presidential election results. The Trump administration’s crypto-friendly stance has created an atmosphere where traditional financial institutions feel more confident pursuing digital asset strategies. This regulatory clarity addresses one of the primary concerns that previously deterred major financial institutions from embracing stablecoin technology.
The bipartisan nature of stablecoin legislation suggests that this regulatory framework will persist regardless of future political changes. The GENIUS Act promises faster, cheaper and safer cross-border transactions, providing the legal foundation necessary for widespread institutional adoption.
The entry of major banks and payment processors into the stablecoin market will fundamentally alter competitive dynamics. Current market leaders like Tether, which made $13B in profits with USDT, face the prospect of competition from institutions with vastly superior distribution networks and regulatory relationships.
This institutional participation could address some of the transparency and regulatory concerns that have plagued the stablecoin sector. Bank-issued stablecoins would likely operate under existing banking regulations, potentially providing greater confidence for corporate treasuries and institutional investors.
As this stablecoin revolution unfolds, the convergence of regulatory clarity, institutional participation, and technological innovation creates unprecedented opportunities. The bank cited faster and more efficient money movement — domestic ACH transfers settle between 1-3 days — as the key driver behind the decision to explore stablecoin issuance.
The transformation extends beyond mere efficiency gains. Stablecoins represent a fundamental reimagining of how money functions in a digital economy, enabling programmability, instant settlement, and reduced counterparty risk. As Bank of America’s analysis suggests, we are witnessing the early stages of a fintech boom that could rival the internet’s impact on commerce and communication.
For investors, businesses, and consumers, the message is clear: the stablecoin revolution is not a distant possibility but an imminent reality. With major financial institutions committing resources and regulatory frameworks taking shape, 2025 appears positioned to be the year when stablecoins transition from crypto curiosity to mainstream financial infrastructure.