Based on data from Artemis, the stablecoin supply reached $162.1 billion in August, after increasing by $4.7 billion, representing a 3% monthly increase. This volatility reflects various trends in the market, including institutional adoption, demand for stability and liquidation, and increased trust in stablecoins.
Notably, the increase in stablecoin supply came as Bitcoin (BTC) fell nearly 9% in the same month, negatively affecting the entire cryptocurrency market.
USDT continues to lead the market with a market Capital of $119 billion, far exceeding the supply of USDC, the second-largest stablecoin with a Capital of $33.5 billion. Maker's stablecoin Dai is third, with a market Capital of $5.3 billion.
Anastasija Plotnikova, CEO and co-founder of Fideum, Chia that this disparity reflects a change in investor behavior, who are now shifting their assets to more stable and liquidation solutions.
“While this trend may support the overall health of the cryptocurrency market by providing a safe haven for assets, it also raises important questions about the long-term stability of stablecoins. The continued development of stablecoins will likely play a vital Vai in shaping the future of the cryptocurrency market.”
In terms of long-term stability, Plotnikova highlighted that the European Union (EU) regulatory framework for Markets in Cryptoasset ( MiCA ) is introducing new regulations for stablecoins, increasing compliance and oversight requirements. While the outcome of these regulatory changes remains unclear, she believes that stablecoins will continue to play an important Vai in facilitating low-cost international transactions and increasing demand and adoption in the crypto ecosystem.
Philipp Zentner, CEO of LI.FI, suggested that the increase in stablecoin supply while cryptocurrency prices are falling could also be an indicator of institutional interest. He explained that institutions often use stablecoins as a tool to participate in the cryptocurrency market without facing the risk of high volatility.
This creates a vicious cycle where institutional adoption leads to an increase in stablecoin supply, which in turn drives trust from other institutions and strengthens trust in the crypto space.
“We can expect to see a large number of stablecoins launch in the near future. Major companies such as JPMorgan, VanEck and PayPal have developed their own stablecoins to bring their customers into the crypto ecosystem.”
James Davies, CPO of Crypto Exchange CVEX.XYZ, sees stablecoins as the most successful crypto use case to date, leveraging existing crypto platforms with the ability to transfer funds Trustless between entities.
However, he stated that the stablecoin supply is still in a “very early” growth phase, given the discussions surrounding central bank digital currencies ( CBDCs ) and the transferability potential of digital assets.
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According to Cryptobriefing
