Hayes warned that a wave of copycat companies will likely emerge — many of which will be structurally weak, overvalued, and doomed to fail. Despite the bullish sentiment around Circle and the stablecoin sector, Hayes predicts a bubble driven more by hype and poor fundamentals than sustainable value.
Meanwhile, Circle CEO Jeremy Allaire compared stablecoins to the iPhone in their early days, and pointed to growing institutional interest and surging transaction volumes as signs of mainstream adoption. Major retailers and platforms like Amazon, Walmart, and Shopify are exploring or integrating stablecoin payments. At the same time, JPMorgan’s new trademark filing for “JPMD” fueled speculation that the bank could soon launch its own stablecoin.
Circle Copycats Face Harsh Reality
BitMEX founder Arthur Hayes issued a stark warning about the next phase of the crypto market, and described it as the beginning of a new “stablecoin mania” after Circle’s highly successful IPO. In a post on Monday, Hayes said that while Circle’s public listing was a huge milestone for the industry, it is also the start of a bubble that will ultimately burst. He predicted that many companies will try to replicate Circle’s success, but most will be overvalued and ultimately fail due to structural challenges and market saturation.
Hayes didn’t mince words in his criticism of these upcoming ventures, and labeled them “Circle copycats.” He also suggested that their business models rely more on showmanship and leverage than sustainable financial practices.
He warned investors to be extremely cautious, and described the coming wave of stablecoin stocks as something to be traded like a “hot potato.” Despite his grim outlook, Hayes stopped short of recommending short positions due to the strong pro-crypto sentiment in the US and a narrative-driven surge in demand that could initially drive prices sharply upward. “These new stocks will rip the faces off of shorts,” he cautioned.
The US Senate is set to vote on critical stablecoin legislation on June 17, which could lend even more momentum to the sector if passed. Chainlink co-founder Sergey Nazarov agreed with Hayes’ outlook by saying the approval of US regulation would trigger a global explosion in stablecoin projects. However, Hayes pointed out that distribution is still the Achilles’ heel for most new entrants. According to him, without access to major crypto exchanges, social media platforms, or legacy banking systems, new stablecoin companies have little to no chance of survival.
Additionally, he argued that the few existing distribution channels are already locked up by incumbents, forcing newcomers to either pay high fees or offer unsustainable yields to attract users. At the same time, he believes Web2 giants and banks are more likely to issue their own stablecoins than partner with new providers. As a result, most new stablecoin IPOs will be speculative hype rather than solid investments. Hayes was particularly scathing toward the upcoming wave of founders, and described them as “suited-up clowns” set to deceive the public into buying into weak companies.
Circle share price since launch (Source: Google Finance)
Even Circle (CRCL), he claims, is currently “insanely overvalued,” as half of its interest income is handed over to Coinbase. Yet, he acknowledged that the stock’s price will likely stay elevated due to market enthusiasm. Circle’s share price has surged over 80% since its listing on June 5, and reached an all-time high on June 16.
Stablecoins Near iPhone Moment
Circle CEO Jeremy Allaire believes that stablecoins are nearing a pivotal moment in mainstream adoption, and compared their current stage to the early days of the iPhone before developers recognized its full potential. In a post on Saturday, Allaire said that while stablecoins haven’t yet attracted developers at the same scale as Apple’s revolutionary product, that breakthrough is coming soon. He described stablecoins as “the highest utility form of money ever created.”
Allaire’s comments were made in response to a post by a16z Crypto partner Sam Broner, who argued that stablecoins promote competition by lowering the costs of launching fintech applications. According to Broner, this new openness encourages better pricing, experiences, and accessibility in financial services.
The discussion coincides with reports that major retailers like Walmart and Amazon are considering launching their own dollar-backed stablecoins for consumer use. Meanwhile, e-commerce platform Shopify confirmed plans to integrate Circle’s USDC for payments by the end of 2025.
A16z Crypto data scientist Daren Matsuoka added to the bullish outlook by stating that stablecoins might be the crypto industry’s best chance to onboard a billion users. He explained that stablecoins have processed $33 trillion in transactions over the past year — which is almost 20 times PayPal’s volume, almost triple that of Visa, and rapidly approaching ACH transaction levels.
This surge in adoption momentum follows Circle’s recent listing on the New York Stock Exchange. However, Tether opted not to follow suit. On June 8, Tether CEO Paolo Ardoino confirmed that the company has no plans to go public.
New JPMorgan Trademark Sparks Stablecoin Speculation
Meanwhile, JPMorgan Chase took a major step toward expanding its presence in the blockchain and digital asset space with a new trademark filing for “JPMD” in the United States. The trademark application was submitted to the US Patent and Trademark Office on Sunday, and outlines a comprehensive suite of crypto-related services, including digital asset trading, exchanges, transfers, clearing, and payment processing. While the application does not specifically mention stablecoins, the breadth of services it covers intensified speculation that JPMorgan may be preparing to launch its own stablecoin.
These developments happened on the heels of a report from The Wall Street Journal on May 22, which indicated that JPMorgan, alongside other major financial institutions like Bank of America and Wells Fargo, is actively exploring the launch of a joint stablecoin. The timing of this report and the recent trademark filing led industry observers to draw connections between the two, with some suggesting that JPMorgan’s actions point to an accelerated push into blockchain-native financial infrastructure aimed at competing with established crypto players.
Despite CEO Jamie Dimon’s longstanding skepticism toward Bitcoin, JPMorgan maintained a positive stance on blockchain technology as a tool for modernizing traditional finance. The firm already made inroads through its Kinexy platform (previously known as Onyx), which facilitates interbank payments using JPM Coin, a blockchain-based digital token backed 1:1 by fiat currencies including the US dollar, British pound, and euro. To date, Kinexy has handled over $1.5 trillion in tokenized transactions.
The news of JPMorgan’s trademark application also arrives at a time of increasing regulatory momentum in the US regarding stablecoins. Last week, the Senate voted 68-30 to advance the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, clearing the way for debate and a full floor vote. If approved by both chambers of Congress, the bill will head to President Donald Trump for final authorization.
