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Stablecoins and the Future of Payments: Evidence from Financial Markets

Author

Listed:
  • Alexander Copestake
  • Cage Englander
  • Maria Soledad Martinez Peria
  • Mr. Germán Villegas-Bauer

Abstract

We examine whether financial market participants, in aggregate, expect stablecoins to play an important role in payments. Using high-frequency variation in stock prices, we estimate that U.S. legislation supporting the use of stablecoins in payments reduced the market value of listed incumbent payment firms by 18% or approximately $300 billion, consistent with stablecoins increasing competition in the payments sector. This impact is larger than that of other recent pro-competitive regulatory shocks and (i) proportionately larger for incumbents focused on cross-border payments, (ii) smaller for incumbents protected by network effects, and (iii) smaller for incumbents already offering crypto-related services.

Suggested Citation

  • Alexander Copestake & Cage Englander & Maria Soledad Martinez Peria & Mr. Germán Villegas-Bauer, 2026. "Stablecoins and the Future of Payments: Evidence from Financial Markets," IMF Working Papers 2026/052, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2026/052
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