The cryptocurrency landscape has witnessed significant developments in recent times, particularly following the election victory of a crypto-friendly government led by Trump. This political shift has sparked a rally in cryptocurrency prices, drawing considerable attention to the digital-assets market. Notably, the market’s overall value has surged by nearly a trillion dollars, driving both Bitcoin and SOL to unprecedented levels. Amidst this surge, stablecoins have emerged as key players, breaking records with soaring market caps.
Stablecoin Market Reaches Record Highs
In a noteworthy achievement, the combined market size of stablecoins has reached an impressive $190 billion this month, according to a report from CCData. This milestone surpasses the previous all-time high of $188 billion, recorded in April 2022, prior to the collapse of the Terra-Luna stablecoin. The rapid growth of stablecoins underscores their increasing importance in the cryptocurrency ecosystem.
Tether Dominates the Stablecoin Sector
Tether’s USDT continues to lead the stablecoin market, with its market cap experiencing a 10% increase over the past month, reaching a new peak of $132 billion. Meanwhile, Circle’s USDC has also seen a significant rise, growing by 12% to nearly $39 billion, marking its highest market cap since the March 2023 regional banking crisis that impacted the token. Tether currently holds a commanding 69.9% market share, with USDC as the second-largest at 20.5%.
According to a Bloomberg report, Tether is expanding the usage of USDT across various industries, including commodities. The company recently announced its involvement in funding a crude oil transaction in the Middle East, showcasing its efforts to broaden the application of its stablecoin.
38 Tokens Achieve All-Time Highs
In an impressive trend, 38 of the nearly 200 tokens tracked have achieved new all-time high supplies over the past month. One notable example is Ethena’s USDe, which saw a remarkable 42% increase, reaching a record $3.8 billion in November. This token provides yield to investors by holding spot BTC and ETH while shorting an equivalent amount of perpetual futures, effectively farming the funding rate.
The broad-market rally in the crypto sector has also led to a significant boost in trading volumes, particularly with stablecoin pairs on centralized exchanges. These volumes increased by 77% month-over-month, reaching $1.8 trillion. USDT was responsible for approximately 83% of the trading volumes, followed by First Digital’s FDUSD at 9% and USDC at 8%.
Tether’s Strategic Shift: Discontinuation of EUR₮
In a strategic move, Tether has announced the discontinuation of its euro stablecoin, EUR₮. The company has ceased processing new minting requests since 2022, attributing this decision to the increasingly complex regulatory environment surrounding stablecoins in Europe. Tether is now focusing on supporting new projects, introducing stablecoins EURQ and USDQ, developed in collaboration with Quantoz Payments and compliant with MiCAR regulations.
Overall, the cryptocurrency market is experiencing a dynamic phase of growth, with stablecoins playing a pivotal role in this evolution. As these digital assets continue to gain traction, their impact on the broader financial landscape is undeniable, offering both opportunities and challenges for investors and stakeholders alike.
