The stablecoin market has experienced a significant surge, reaching a new all-time high of $168 billion. This milestone marks an 11-month streak of consecutive growth, excluding algorithmic stablecoins.
DefiLlama data reveals that the total stablecoin market cap has surpassed its previous peak set in March 2022. While the market experienced a downturn following this peak, it has steadily recovered and surpassed its previous high.
Crypto analyst Patrick Scott, also known as “Dynamo DeFi,” believes this surge indicates an influx of new money into the cryptocurrency market. He noted that retail investors have been active for at least eight months, suggesting that institutional investment may not be the primary driver of the rally.
Leading the charge among stablecoins is Tether (USDT), which has consistently gained market capitalization throughout 2024. Starting the year at $91.69 billion, USDT has reached a new high of over $117 billion in August.
Circle’s USD Coin (USDC) has also experienced growth, reaching a market cap of over $34 billion. However, this remains below its all-time high of $55.8 billion achieved in June 2022.
Despite the overall growth in the stablecoin market, trading volumes have declined. According to a report by CCData, stablecoin trading volumes fell 8.35% to $795 billion in July due to lower trading activity on centralized exchanges. Factors such as the Markets in Crypto-Assets Regulation (MiCA) have contributed to this decline, raising concerns about the future of USDT in Europe.
The trend of lower trading volumes has continued into August, with the current market volume just above $46 billion. As the stablecoin market continues to evolve, it remains to be seen how these regulatory developments and market dynamics will shape its future trajectory.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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