Since October 2023, the stablecoin market has experienced a notable rebound after experiencing a major downturn over the past two years during the bear market. The market now boasts impressive trading volumes and heightened activity.
Based on a recent tweet from crypto analysis firm IntoTheBlock, the total value of stablecoins now stands at around $160 billion. This figure is continuing to rise and is targeting the previous record high of $188 billion, reached during the prior market peak.
Stablecoin Market Cap Recovers
According to IntoTheBlock’s perspective, the expanding market capitalization of stablecoins is a positive sign, indicating robustness for the decentralized finance (DeFi) sector. Stablecoins serve as a crucial foundation in DeFi, underpinning numerous blockchains and protocols.
A leading market intelligence platform explained that a larger market cap for stablecoins enhances crypto market liquidity, making transactions smoother. Stablecoins serve as valuable on-ramps for investors entering the crypto market with fiat currency. Moreover, an expanding stablecoin market cap suggests an influx of capital into the market, often observed during market upswings or bullish periods.
This year, the Bitcoin exchange-traded fund (ETF) industry in the United States, which deals with stablecoins, has had a major impact on the growth of the stablecoin market value. Institutional investors and traditional financial heavyweights have been accumulating stablecoins to gain access to the ETF market.
Tether Maintains Dominance
In the world of stablecoins, some individual assets have experienced impressive growth. Among them is Tether (USDT), currently leading with the largest market share and often referred to as the monarch of stablecoins. This asset boasts a market capitalization surpassing $100 billion, an accomplishment it achieved back in early March.
Tether’s main competitor, Circle (USDC), also has a market value of $33.9 billion. It’s worth mentioning that USDC’s market share decreased in the previous year. This decrease occurred after Circle, the issuer of USDC, disclosed it was impacted by the U.S. banking crisis at that time.
Cryptocurrency companies have recently introduced new stablecoins to the market. For instance, Ethena unveiled its synthetic dollar, USDe, in March and has since then amassed a market value of around $2.3 billion. PayPal entered the scene with PYUSD in August 2023, and it currently boasts a market capitalization exceeding $202 million. Ripple, another crypto solutions provider, announced earlier this month that they plan to launch their stablecoin later in the year.
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2024-04-23 18:38