SKN | Stablecoins Become Core Market Plumbing in Moody’s 2026 Outlook

Stablecoins are rapidly shedding their image as a crypto-native payment tool and emerging as a foundational layer of institutional finance, according to a new cross-sector outlook from Moody’s. The ratings agency argues that 2025 marked a turning point, with stablecoins evolving into “digital cash” used for liquidity management, collateral movement, and settlement across an increasingly tokenized financial system.

In the report published Monday, Moody’s estimates that stablecoins processed roughly $9 trillion in settlement activity in 2025, representing an 87% increase year over year, based on industry estimates of on-chain transactions rather than traditional bank-to-bank flows. The scale of that growth, Moody’s says, reflects a structural shift rather than speculative excess, as regulated institutions increasingly plug blockchain-based money into their core market operations.

From crypto rails to institutional infrastructure

Throughout 2025, banks, asset managers, and market infrastructure providers ran extensive pilots involving blockchain settlement networks, tokenized securities, and digital custody platforms. The goal was not retail payments, but efficiency: faster settlement cycles, reduced counterparty risk, and improved intraday liquidity management.

Moody’s estimates that more than $300 billion could be invested globally in digital finance and infrastructure by 2030, as firms build the rails needed for large-scale tokenization. Within this framework, fiat-backed stablecoins and tokenized deposits are increasingly used to settle cross-border payments, repo transactions, and collateral transfers.

The report points to growing use of cash- and U.S. Treasury-backed stablecoins to facilitate same-day movements between funds, credit pools, and trading venues. Trials at global banks such as Citigroup and Société Générale illustrate how stablecoins are being used internally as programmable settlement assets rather than speculative instruments.

Deposit-token models are also gaining traction. JPM Coin is cited as an example of how “digital cash” layers can sit on top of traditional banking systems, enabling programmable payments while remaining integrated with existing compliance, treasury, and liquidity frameworks.

Regulation catches up to “digital cash”

Moody’s notes that regulation is beginning to align with this shift. In Europe, the Markets in Crypto-Assets (MiCA) framework has provided clearer rules for issuance, custody, and redemption of stablecoins and tokenized deposits. In the United States, stablecoin and market-structure proposals are moving through Congress, while jurisdictions such as Singapore, Hong Kong, and the United Arab Emirates have introduced licensing regimes for digital asset services.

Bank-issued products such as Société Générale-Forge’s EUR-denominated stablecoin are highlighted as early examples of regulated digital money built within these frameworks. In the Gulf region, Moody’s points to experiments with dirham-referenced payment tokens as part of broader digital money architectures.

Taken together, these efforts suggest a convergence toward common standards, even if implementation remains fragmented across regions.

New rails, new risks

Despite the momentum, Moody’s cautions that the transformation is not risk-free. As more value migrates onto digital settlement rails, vulnerabilities shift rather than disappear. The report flags smart-contract bugs, oracle failures, cyberattacks on custody systems, and fragmentation across blockchains as emerging sources of operational and counterparty risk.

Moody’s argues that security, interoperability, and governance will be as critical as regulatory clarity if stablecoins are to function as reliable institutional settlement assets. Without robust controls, the same programmability that makes digital cash attractive could amplify failures at scale.

Looking ahead to 2026, the agency’s view is clear: stablecoins are no longer peripheral to financial markets. They are becoming part of the plumbing. The challenge now is ensuring that this new infrastructure is resilient enough to support the growing volume of real-world capital flowing through it.