Stablecoin Total Market Value Reaches Milestone of $200 Billion, Asset Management Company Bitwise Bullish on Doubling Growth Next Year

Stablecoin Total Market Value Reaches Milestone of $200 Billion, Asset Management Company Bitwise Bullish on Doubling Growth Next Year

Stablecoin Total Market Value Reaches Milestone of $200 Billion, Asset Management Company Bitwise Bullish on Doubling Growth Next Year

With the increasing demand and adoption of stablecoins, the total market value of stablecoins exceeded 200 billion US dollars for the first time on Wednesday. According to CCData and DefiLlama, stablecoins have grown by 10 billion US dollars in market value in just two weeks since surpassing the record of 190 billion US dollars set during the bull market cycle of 2022.

Source: CCData

As the cryptocurrency market emerges from the bear market, the demand for stablecoins has steadily grown over the past year. The growth rate of stablecoins has significantly increased since Donald Trump, who supports cryptocurrencies, won the election last month. The supply of stablecoins has increased by nearly 30 billion US dollars since November 6.

Data from DefiLlama shows that the largest stablecoin by market value is Tether’s USDT, with a supply of around 140 billion US dollars, growing by approximately 12% in a month. On December 10, Tether announced that the Abu Dhabi Financial Services Regulatory Authority (FSRA) has accepted USDT as an “Accepted Virtual Asset” (AVA) for the Abu Dhabi Global Market (ADGM).

The second-largest stablecoin by market value is USDC issued by Circle, which has also grown by about 12% in the past month, reaching around 41.6 billion US dollars. Circle recently established a new strategic partnership with the cryptocurrency exchange Binance to promote the adoption of USDC globally.

The actual use of stablecoins, such as payments and savings, has also contributed to their growth. In addition to the growth of the cryptocurrency market, stablecoins have found increasing use in payment, remittance, and savings, especially in developing countries with rapidly depreciating local currencies and fragile financial systems.

Nik Milanovic, a partner at venture capital firm Fintech Fund, pointed out that the growing number of stablecoin transactions on transfer applications, including peer-to-peer payment platforms, is a sign of stablecoin adoption in non-cryptocurrency use cases.

Stablecoins that offer price stability and provide returns to investors have also gained popularity. According to DefiLlama, USDe issued by stablecoin protocol Ethena has grown by nearly 88% in market value in a month, reaching 5.6 billion US dollars to become the third-largest stablecoin. The stablecoin USD0 from emerging decentralized finance (DeFi) protocol Usual has surged to 790 million US dollars, doubling its size during the same period.

Bitwise predicts that the market value of stablecoins will double next year

In a report released on Tuesday, digital asset management company Bitwise predicts that the market size of stablecoins will reach 400 billion US dollars by 2025. One of the key catalysts could be the long-awaited stablecoin legislation passed by the US Congress, which will define rules for the issuance and interaction of stablecoins by businesses and institutions.

The report also suggests that other growth catalysts include popular fintech applications integrating stablecoins into their services, similar to PayPal’s PYUSD stablecoin, and the increasing importance of stablecoins in global payments and remittances.

Bitwise is not the only one with a positive outlook on stablecoins. Standard Chartered Bank and its digital asset brokerage company Zodia Markets predicted in a report last month that the adoption of stablecoins will significantly increase and may account for 10% of US M2 transactions in the future.

Data source