The total stablecoin market capitalization, excluding algorithmic stablecoins, hit its all-time high over the weekend, DefiLlama data shows.
Stablecoin’s market cap expanded by 0.8% over the past week to over $168.1 billion, surpassing the previous peak in March 2022 of around $167 billion.
The market cap hit a low of around $122 billion in October as the market cap started to dwindle a few months after the March 2022 high. Since the beginning of 2024, the stablecoin market cap has continued to grow, according to DefiLlama data.
A rising stablecoin market cap may indicate that crypto is attracting more money from institutional investors, Rachael Lucas, a crypto analyst of BTCMarkets, told The Block.
“Traditionally, demand for stability in uncertain market conditions has driven investors towards stablecoins as a safe haven,” Lucas said. “Alternatively, the increase in the stablecoin market cap could reflect growing confidence in the crypto market, especially from institutional investors.”
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Lucas added that stablecoins are being increasingly utilized by institutional investors as a bridge between TradFi and crypto. “This trend underscores a broader shift towards integrating stable digital assets into both trading strategies and long-term portfolios.”
Meanwhile, USDT
+0.00038%
, the largest stablecoin, has seen its market cap grow about 28% this year, from $91.68 billion at the beginning of this year to $117.84 billion today. USDT now accounts for about 70% of the total market capitalization, according to DefiLlama data.
Circle’s USDC, despite some fluctuations in market cap, has also experienced an upward trend in 2024, growing from $23.8 billion in early January to $34.4 billion today.
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