Half of global currencies will feature in the stablecoin market by 2026, predicts Fiorenzo Manganiello, co-founder and managing partner of investment firm LIAN Group.
The prediction follows recent news that China is considering allowing the use of yuan-backed stablecoins, marking a potential reversal of its ban on cryptocurrency in payments.
Manganiello suggests that a policy shift from China would signal that stablecoins are becoming a non-negotiable component of the global payments landscape. The stablecoin market has historically been dominated by US dollar-pegged assets, such as USDT and USDC.
However, Manganiello argues that China’s potential entry into the market could catalyse a trend of de-dollarisation as other countries seek to introduce stablecoins backed by their own currencies to boost their position in global payments.
Catalyst for market diversification
According to Manganiello, this development, combined with growing institutional interest in the West, could create a “watershed moment” for the tokens.
“If China proceeds in allowing yuan-pegged stablecoins, it will catalyse what could be a mass diversification in the market – a real watershed moment,” said Manganiello.
“Don’t get me wrong, while the market has somewhat diversified, stablecoins are still very much seen as a ‘dollarised’ asset – and you only have to look at the popularity of USDT, USDC, and further afield, USDe, and DAI as evidence. That being said, if China, the world’s second-largest economy, wades in, that could all shift.”
Manganiello added: “With greater regulatory guardrails and institutional acceptance, stablecoins are becoming a must-have in the global payments sector. And as they enter deeper into mainstream finance, and governments internationally warm further, there’s no denying that the market could rapidly diversify, with more currencies featuring on the league table. A boom is already underway, and if there was ever a time for the market to expand, it’s now.”
LIAN Group, where Manganiello is managing partner, reports having deployed over $500million in capital across companies in sectors including blockchain and artificial intelligence. Manganiello also serves as a professor of blockchain technologies at Geneva Business School.
