- The market capitalization of stablecoins exceeds $500 billion:

A Hashdex report predicts that by 2026, stablecoins will emerge as a fundamental pillar of the digital financial system, driven by regulatory clarity following the enactment of the GENIUS law and increasing institutional confidence.

The analyst also explained that the figure will rise from $295 billion today to over $500 billion in 2026.

"With growing expectations for stablecoins—some estimates suggest this market will surpass $2 trillion by 2028—it is crucial to analyze the broader implications of their growth on cryptocurrency investors, including how they could fundamentally reshape the global dominance of the dollar and the status of US debt as a reserve asset."

Total market capitalization forecast for stablecoins. Source: Hashdex

Federal Reserve Outlook and Global Geopolitical Situation
On the macroeconomic front, the CME FedWatch tool shows a greater than 75% probability that the Federal Reserve will cut interest rates at least twice by the end of 2026, as illustrated in the chart below. However, the Federal Reserve's dot plot indicates that policymakers expect the federal funds rate to decrease to 3.4% by 2026, implying only one additional rate cut from its current range of 3.50% to 3.75%.

Target interest rate probabilities for the Federal Reserve meeting on December 9, 2026. Source: Chicago Mercantile Exchange (CME)

Furthermore, the dovish expectations for the Federal Reserve are influenced by the weakness of the US labor market and continued support from President Donald Trump for interest rate cuts. These dovish expectations for rate cuts by central banks could increase investor risk appetite, which would drive Bitcoin prices higher in 2026.

Meanwhile, on the geopolitical front, ongoing uncertainty between Russia and Ukraine, the United States and China, and Thailand and Cambodia may come to an end by 2026. These potential resolutions of global uncertainty could trigger a risk-on trend, potentially boosting riskier assets like Bitcoin.