The supply of USD Coin (USDC), the second largest stablecoin behind Tether (USDT), has increased significantly in recent months, rising 14.3% or $3.5 billion since December 1, 2023.
This has increased USDC’s overall market value to $28 billion, although it is still far behind USDT’s $98 billion market cap. However, USDC now accounts for 4% of worldwide cryptocurrencycurrency exchange trading volumes, showing increased adoption and use.
Analysts credit USDC’s comeback to increased retail and institutional investor demand following the launch of spot bitcoin exchange-traded funds (ETFs) in late 2023. The ETFs attracted more mainstream investors to cryptocurrency markets, increasing demand for key stablecoins such as USDC as a safe haven during market turbulence.
Circle, the issuer of USDC, has also made strategic efforts, including as expanding trading services internationally on platforms like Coinbase and relisting USDC trading pairs on major exchanges like Binance. This has greatly increased USDC’s liquidity and accessibility to investors worldwide.
While Tether remains the biggest stablecoin, with a market capitalization roughly four times that of USDC, USDC’s strong rise indicates that the market is shifting toward alternatives. As Circle continues to expand its services globally, many observers expect that USDC adoption will increase even further, reinforcing its critical role in creating the future infrastructure of digital asset markets.
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