The Chairman of the Federal Reserve, Jerome Powell, has said last week that there would be no attempt to curb or ban cryptocurrencies or stablecoins in any manner, something which China has been trying to do over the last few weeks.
It appears that the US would not be interested in such a strict action against an industry that has been growing and bringing in a lot of innovation over the last few months. This much is pretty clear. The need for cryptos, stablecoins, and the demand for them from the public is pretty much clear and the US would not want to play with that. So the cryptos would continue to exist, be traded at exchanges, and be used as much as they are allowed to, within the regulatory purview that the laws and regulations allow at this point. It is also clear that the Fed would not allow any of the cryptos to exist without any regulatory control and they would do their best to bring them under their control and oversight making them similar to a digital dollar.
The digital dollar is likely to be announced sooner or later. More and more countries are thinking of launching the digital version of their currencies and it would not be possible for the US to remain oblivious of the same and so it is quite likely that they would join the CBDC bandwagon pretty soon. If and when this happens, it is going to bring the mainstream usage of cryptos and stablecoins under some serious pressure. Cryptos with regulatory oversight would be as efficient or inefficient that the digital dollar would be and when a government-backed digital dollar is available, it would not make much sense for any user to be using any crypto or stablecoin for any payments unless he is looking to sidestep the law.
With the mainstream usage of cryptos removed in due course of time, it would only be a matter of time before they become restricted to being traded in the exchanges alone with not much practical real-world use. This is going to be an even bigger challenge for the cryptos in that they would need to stay relevant in a world where they have to co-exist with the digital versions of various fiat currencies that are backed by the respective governments.