Circle predicts 40% stablecoin growth rate as base case, doesn't see banks as rivals

• Circle CEO Jeremy Allaire says a stablecoin compound annual growth rate of 40% is a "reasonable baseline."
• He added that banks have moved away from pilots to full-scale implementation.
• Allaire said the company does not view banks or payment firms as competitors.

Circle CEO Jeremy Allaire outlined an optimistic vision for the stablecoin industry's future, projecting a compound annual growth rate of 40% as a "reasonable baseline" for the sector over the coming years.

Speaking in an interview with CNBC Squawk Box at Davos on Thursday, Allaire emphasized that the stablecoin market has reached an inflection point, with institutional adoption accelerating beyond experimental phases into production-scale deployments across the financial system.

Allaire noted a fundamental shift in how traditional financial institutions approach stablecoins. "Banks have moved from pilots to actual production implementation," he explained, highlighting that major financial institutions are now integrating stablecoins into their core payment and treasury operations rather than treating them as experimental projects.

Circle says payment firms and banks are not competitors

Allaire emphasized that Circle does not view banks or payment companies as competitors in the stablecoin ecosystem. Instead, he framed the company's role as providing infrastructure that enables these institutions to enhance their own services.

"We see ourselves as building neutral infrastructure," Allaire stated, comparing Circle's position to foundational internet protocols rather than competitive financial products. This philosophy positions USDC as a utility layer that banks, payment processors, and fintech companies can leverage without concern about competing directly with Circle for end customers.

The CEO suggested that stablecoins represent a transformative upgrade to the global financial system's plumbing rather than a replacement for existing institutions. "This is about making the financial system work better for everyone," he remarked, noting that banks bring crucial elements like customer relationships and regulatory expertise that complement Circle's technology infrastructure.

Allaire's 40% growth projection reflects both current momentum and structural advantages of stablecoins over legacy payment rails. He pointed to increasing demand for instant settlement, 24/7 availability, and programmable money features that traditional systems cannot easily replicate.

The stablecoin market currently exceeds $300 billion, with growth driven by use cases ranging from cross-border payments to decentralized finance applications and corporate treasury management.

Circle's bullish growth forecast signals confidence that regulatory clarity and institutional adoption will continue expanding the stablecoin ecosystem throughout 2026 and beyond.