The stablecoin market capitalization, excluding algorithmic stablecoins, reached a record $168.1 billion, reflecting increased institutional interest and confidence in crypto.
Bollywood Fever: The total stablecoin market capitalization, excluding algorithmic stablecoins, reached a new all-time high over the weekend, according to data from DefiLlama.
The market cap grew by 0.8% over the past week, surpassing $168.1 billion, eclipsing the previous peak of approximately $167 billion set in March 2022.
After hitting a low of around $122 billion in October 2022, the stablecoin market has seen a steady recovery, with significant growth since the beginning of 2024.
This resurgence is viewed as a positive indicator for the crypto market, potentially signaling increased interest from institutional investors.
Rachael Lucas, a crypto analyst at BTCMarkets, told The Block that a rising stablecoin market cap could reflect a growing demand for stability in uncertain market conditions, driving investors towards stablecoins as a safe haven.
Additionally, Lucas suggested that the trend might indicate growing confidence in the broader crypto market, particularly from institutional players.
“Stablecoins are increasingly being used by institutional investors as a bridge between traditional finance (TradFi) and the crypto world,” Lucas said. “This trend highlights a broader shift towards integrating stable digital assets into both trading strategies and long-term portfolios.”
Among stablecoins, USDT (Tether) remains the largest, with its market cap growing by about 28% this year, from $91.68 billion at the start of 2024 to $117.84 billion today.
USDT now represents approximately 70% of the total stablecoin market capitalization, according to DefiLlama data.
Circle’s USDC has also experienced growth in 2024, with its market cap increasing from $23.8 billion in early January to $34.4 billion currently, despite some fluctuations along the way.
The continued expansion of the stablecoin market underscores the increasing role these digital assets play in the evolving crypto ecosystem, particularly as a tool for institutional investors seeking stability and flexibility in their portfolios.
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