Market Capitalization of USDC Stablecoin Sees Resurgence
The market capitalization of the USDC stablecoin has witnessed faster growth compared to its leading counterpart USDT in recent months.
Market Capitalization of USDC Stablecoin Sees Resurgence
The second-largest stablecoin, USDC, issued by Circle and backed by cryptocurrency exchange Coinbase, is experiencing a resurgence in market capitalization, rising to $28.5 billion from its low point in 2023.
According to CoinMarketCap data, since the beginning of December 2023, USDC's market capitalization has surged nearly $4 billion from its initial $24.55 billion, marking a 14.3% increase, surpassing the approximately 9% growth of its competitor Tether (USDT) during the same period.
Within 1 month, $USDC circulating supply has increased 9.4% and now stands at $28B, its highest level since June 2023. During this time, the total stablecoin market cap increased by $4.5B. Interestingly USDC was responsible for about 53% of this increase.
— David Alexander II (@Mega_Fund) February 21, 2024
More liquidity and… pic.twitter.com/7DiBQxlL5W
This resurgence marks the first sign of USDC's market capitalization recovery after Circle was severely impacted by a $3.3 billion freeze at Silicon Valley Bank's collapse in March 2023, causing a brief $10 billion drop in market capitalization.
USDC market capitalization rebounding after a prolonged downturn. Image: CoinMarketCap
David Shuttleworth, research partner at Anagram, attributes this resurgence to increased liquidity and a surge in user participation, leading to nearly a 10% increase in USDC's supply in recent months, responsible for nearly 50% of the overall stablecoin market share growth.
In fact, the resurgence of USDC somewhat reflects overall growth in capital inflows into the cryptocurrency market, particularly after the U.S. Securities and Exchange Commission (SEC) gave the green light to all Bitcoin Spot ETF products.
We are thrilled that @coincheckjp is planning to expand access to $USDC to Japan! This marks a significant milestone in bringing the stability of USDC to Japan, and is a strategic expansion for USDC in Asia.
— Circle (@circle) February 27, 2024
Read more about the collaboration here: https://t.co/DOdOxe1LgT pic.twitter.com/t93fYPoEl5
The rise to over $55,000 for Bitcoin (BTC) has also been driven by substantial demand from investors and financial institutions in the United States, where USDC is a more popular choice than USDT, which primarily dominates in Asia, Africa, and Latin America on foreign exchanges such as Binance.
Reports from Coinbase also indicate that USDC's spot and derivative trading market share on global centralized exchanges (CEX) has increased nearly fourfold, reaching 4% from below 1% in mid-2023.
USDC market share in trading volume on centralized cryptocurrency exchanges. Source: Coinbase
Additionally, the increase in USDC's market capitalization must be attributed to Circle's continuous efforts to expand market share over time. In 2022, cross-border transfers to Asia reached $130 billion in USDC, with the Asia-Pacific region accounting for 29% of the total global digital value received, surpassing North America (19%) and Western Europe (22%).
Circle has also consistently collaborated with various exchanges and blockchain platforms to integrate USDC into their networks. Most recently, USDC integration into Celo, a layer-1 blockchain that has transitioned into Ethereum's Layer-2 scaling solution, and Japan's Coincheck exchange to enhance USDC coverage in the Asian market.
We are thrilled that @coincheckjp is planning to expand access to $USDC to Japan! This marks a significant milestone in bringing the stability of USDC to Japan, and is a strategic expansion for USDC in Asia.
Read more about the collaboration here: https://t.co/DOdOxe1LgT pic.twitter.com/t93fYPoEl5— Circle (@circle) February 27, 2024
