Stablecoin Market Cap Hits $161B Amid Eight-Month Growth Streak


The stablecoin market has reached its highest capitalization since April 2022, following eight consecutive months of growth, according to a new report by cryptocurrency analytics platform CCData

As of May 29, the market cap for stablecoins rose 0.63% from the start of the month, reaching $161 billion. This marks a significant milestone in the recovery of stablecoins after a prolonged period of decline.

Overall Stablecoin Dominance Declines

Despite this growth in market cap, the dominance of stablecoins in the overall cryptocurrency market slightly decreased to 6.07%, down from 7% in March. This decline reflects a broader recovery in the prices of major crypto assets, driven by improved market sentiment following the unexpected approval of a spot Ethereum ETF in the United States.

Among the top ten stablecoins, Athena USDe stood out with its market cap increasing for the fifth consecutive month. It saw an 11.6% rise to $2.61 billion, attributed to its expanded use as collateral for perpetual trading on Bybit. This consistent growth highlights Athena USDe’s increasing utility in the decentralized finance (DeFi) sector.

Performance of Stablecoins

Tether (USDT), the largest stablecoin by market cap, recorded an all-time high market cap of $111 billion as of May 29. This increase solidified its dominance in the stablecoin market, with a 69.3% share. Tether’s robust performance underscores its continued appeal as a stable and reliable digital asset amidst fluctuating market conditions.

In another significant development, BlackRock’s tokenized fund token, BUIDL, surged 19.6% to $448 million. This makes BUIDL the largest tokenized treasury fund, surpassing Franklin Templeton’s BENJI. BUIDL represents a share in BlackRock’s USD Institutional Digital Liquidity Fund and can be swapped to USDC on a 1:1 basis, offering investors a new avenue for liquidity and stability.

Circle’s USDC also saw a notable increase in market capitalization for the sixth consecutive month, reaching $32.6 billion in May. This rise aligns with growing demand, as USDC pairs recorded an all-time high monthly trading volume in March. 

USDC’s market share by trading volume has risen for the second month to 8.27%, benefiting from increased on-chain trading activity on networks like Base and Solana. The percentage of USDC supply on these chains has grown to 9.29% and 7.78%, respectively.

Stablecoin Trading Volume on CEXs Fell

However, despite the overall increase in market caps, stablecoin trading volumes on centralized exchanges fell to a monthly low of $829 billion on May 23. The report noted that trading activity on centralized exchanges typically declines in the two months following the Bitcoin halving event, suggesting a cyclical pattern in market behavior.

The CCData report concludes that the total market capitalization of stablecoins has now recovered from the losses incurred since the collapse of the Terra Luna ecosystem and the near 100% depeg of the algorithmic stablecoin TerraClassicUSD (USTC). 

This event had initiated a seventeen-month downtrend, but the recent growth signals a robust recovery and renewed confidence in stablecoins as a critical component of the cryptocurrency ecosystem.

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