The United States has witnessed record Bitcoin activity since the launch of Bitcoin (BTC) Exchange Traded Funds. However, stablecoin adoption in the US has slowed down in 2024 compared to global markets, according to a report on October 17 from Chainalysis.
US markets have seen a significant shift in stablecoin activity this year, with the share of stablecoin transactions on US-regulated exchanges declining from around 50% in 2023 to under 40% in 2024.
In contrast, the share of stablecoin transactions on non-US regulated platforms has surged since 2023, crossing the 60% mark in 2024, according to the latest Chainalysis report on Cryptocurrency Adoption Trends in North America.
Share of stablecoin flows to US-regulated and non-US regulated exchanges. Source: Chainalysis
Chainalysis emphasized that this shift does not necessarily indicate a significant decline in stablecoin activity in the US, but rather reflects the growing role of stablecoins in emerging markets and jurisdictions outside the US.
Global demand for US dollar-backed assets has surged
A key driver of the changing global stablecoin usage is the growing demand for US dollar-backed assets, particularly in countries with limited access to stable currencies.
The report noted that over $1 trillion in US dollar banknotes — or about half of the total currency in circulation — was held outside the US borders as of the end of 2022, according to official estimates from the Federal Reserve.
Growth in stablecoin value received by US-regulated and non-US regulated exchanges. Source: Chainalysis
The increasing use of stablecoins outside the US demonstrates a broader trend: global markets are increasingly turning to US dollar-backed stablecoins as a store of value and for low-cost transactions.
Chainalysis' findings reflect observations from Tether CEO Paolo Ardoino, who shared with TinTucBitcoin in early October that the primary demand for stablecoins comes from developing economies like Argentina, Turkey, and Vietnam, rather than the US.
Regulatory uncertainty threatens US leadership in stablecoin adoption
Regulatory uncertainty around stablecoins and digital assets is another factor that has caused the US to lag behind other economies in stablecoin adoption.
According to Chainalysis, the stablecoin company Circle noted that the lack of clear cryptocurrency regulations in the US has enabled financial hubs in Europe and the United Arab Emirates to attract stablecoin projects with more favorable regulatory environments.
Global Cryptoasset distribution as of June 2024. Source: Chainalysis
"The lack of a regulatory framework in the US for USD-pegged stablecoins represents a threat to US interests," a Circle spokesperson warned in the report.
As more countries develop regulatory frameworks that encourage stablecoin adoption, US policymakers are facing increasing pressure to take action, Chainalysis said.
