Stablecoin market cap surpasses $200B
The stablecoin market has reached a significant milestone, surpassing a total market cap of $200 billion for the first time, according to data from CCData and DefiLlama.
This growth is attributed to increased capital inflows for trading cryptocurrencies and a rising demand for stablecoins in non-crypto applications, such as payments.
Notably, the stablecoin sector added $10 billion in value within just two weeks after breaking the previous record of $190 billion set during the 2022 bull cycle.
Bitwise, an asset management firm, forecasts that the market could potentially double to $400 billion by next year. This anticipated growth is linked to expected legislative developments from the U.S. Congress, which could provide clearer regulations for stablecoin issuance and usage.
"Clear answers to big questions—Who regulates them? What are the proper reserve requirements?—will spark massive new interest among issuers, consumers, and businesses," Bitwise analysts noted.
The demand for stablecoins has notably surged as cryptocurrency markets recover from previous downturns. Following Donald Trump's recent election victory, an influx of approximately $30 billion into stablecoins was recorded as investors sought opportunities in the crypto space.
Tether's USDT (CRYPTO:USDT) remains the dominant stablecoin, achieving a record supply of $139 billion, a 12% increase in just one month. This week, USDT was also recognised as an accepted virtual asset by the Abu Dhabi Global Market (ADGM), with plans for broader service expansion in the Middle East.
Circle's USDC (CRYPTO:USDC) has also seen growth, rising nearly 9% to approximately $41 billion in market value after partnering with Binance to enhance its global adoption.
Furthermore, there is evidence of increasing stablecoin utilisation for payments and remittances, particularly in developing nations facing economic instability. Nik Milanovic from Fintech Fund highlighted this trend on social media.
The rise of tokenised products offering yield on stablecoins is also noteworthy. Ethena's USDe (CRYPTO:USDE) token surged over $5 billion in value recently, while Usual's stablecoin doubled to $700 million.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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