The cryptocurrency market has continued to grow significantly since the beginning of this year, and the stablecoin sector is also showing significant expansion.
According to DeFiLlama, stablecoin supply has grown by nearly $20 billion since the beginning of the year, reaching more than $150 billion. This is the highest level observed since the FTX collapse in November 2022.
Why Stablecoin’s $150 Billion Surge Since January Matters
Stablecoins are an important bridge between cryptocurrency markets and traditional fiat currencies. Stablecoins have a significant impact on liquidity given their penetration and popularity among traders. Therefore, the recent uptrend signals the prevailing optimism within the cryptocurrency market, which indicates increased capital inflows.
Tether’s USDT recently surpassed $100 billion in market capitalization and remains the leader. That growth trajectory has continued and now stands at approximately $104 billion.
At the same time, Circle’s USDC is experiencing a revival amidst general market conditions. Supply surged to $32 billion as it expanded its presence across various blockchain networks, reflecting heightened activity and investor confidence.
Read more: The Best Stablecoins Guide for 2024
Meanwhile, recent new entrants to the cryptocurrency market, such as FDUSD and Ethena’s USDe synthetic dollar stablecoin, have experienced a surge in supply. FDUSD’s growth is largely fueled by adoption on platforms like Binance, while USDe enjoys solid support within the cryptocurrency community and offers attractive yields on deposits.
“The (stablecoin) March rise appears to have been driven by increased demand from trading activity on centralized exchanges and decentralized applications, as Bitcoin reached an all-time high for the first time since May 2021,” CCData explained. I did.
Read more: What is the Ethena Protocol and USDe Synthetic Dollar?
Interestingly, the surge in supply has led to a noticeable increase in trading volumes for various assets. Stablecoin trading volume rose 5.14% in February, reaching $1.09 trillion, according to data from cryptocurrency analytics platform CCData. This is the highest stablecoin trading volume on the centralized exchange (CEX) since December 2021.
Moreover, CCData expects March to surpass this figure, with volume already reaching significant levels by mid-month.
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