Cape town: The market capitalization of stablecoins nearly tripled between 2021 and 2025 but has remained relatively flat over the last year at around $300 billion, according to a top IMF official. Dan Katz, IMF First Deputy Managing Director, shared these insights during his remarks at the University of Cape Town, South Africa.

According to Emirates News Agency, nearly 99% of stablecoins are denominated in US dollars, with reserves mainly held in short-term T-bills and reverse repos. Some issuers, however, opt for less liquid and riskier backing assets, indicating a diverse approach to the management of these digital assets.

Further reports reveal that the total stablecoin transaction volume surpassed $30 trillion in 2025, with $6.1 trillion attributed to cross-border transactions. Despite this, most activity remains confined within the crypto ecosystem, largely driven by bots and algorithmic arbitrage, reflecting a significant level of automation and efficiency in the market.

The Bank for International Settlements estimates that only $390 billion of these flows were related to payments in 2025. This figure is small when compared to the global cross-border payments market, which is valued at approximately one quadrillion U.S. dollars annually. Katz also suggested that advances in artificial intelligence could further accelerate the adoption of stablecoins, pointing to a potential future expansion in their use and application.