Key Updates

Key Findings

Stablecoin Market Cap Rises For 12th Consecutive Month

In September, the total market capitalisation of stablecoins rose 1.50% to $172bn, recording the twelfth consecutive increase in the end-of-month market cap. Despite this, the total stablecoin market cap remains below levels seen prior to the de-peg of Terra Luna in May 2022.

Stablecoin trading volumes are on trend to record a lower monthly volume, with $683bn recorded as of the 23rd.

Fed Interest Rate Cuts to Impact Stablecoin Revenues

The Federal Reserve’s pivot to cut the interest rate by 50bps is set to result in $625mn in annualised loss of interest income for the top 5 centralised stablecoins.

The five stablecoins - USDT, USDC, FDUSD, PYUSD, and TUSD - hold combined US Treasury assets of $125bn as of the latest attestation reports.

Digital Yuan Transaction Volume Crosses 7tn RMB

The cumulative transaction volume of digital yuan reached 7tn RMB ($988bn) by the end of June, as per the latest report from the People’s Bank of China.

This represents a growth of 6.10% from the previous month and a surge of nearly 300% from the reported transaction volume as of June 2023.

EURCV Expands to Solana Blockchain

Societe Generale’s EURCoinVertible (EURCV) stablecoin is set to be deployed on the Solana blockchain following a lacklustre demand on the Ethereum network till date.

The on-chain transfer volume and trading volume on centralised exchanges for EURCV pairs remained subdued in September, reaching $2.79mn and $290k as of the 24th.

Stablecoins Market Cap & Volumes

● In August, the total market capitalisation of stablecoins rose 2.89% to $169bn, recording the eleventh consecutive monthly increase in market capitalisation. This is the highest market capitalisation for stablecoins since April 2022.

● Stablecoin market dominance is currently at 7.59%, rising from 6.88% in August. This is the third consecutive increase in stablecoin dominance and the highest since January.

● Stablecoin trading volume fell 14.2% to $848bn in August (as of the 23rd). Trading volumes are on track for a second consecutive monthly increase, driven by volatile digital asset prices following the unwinding of the Japanese Yen carry trade and recovery in TradFi markets.

Stablecoins Overview: Top 10 Stablecoins

● In September, the market cap of TetherUSD (USDT) rose by 0.86% to $119bn, another new a new all-time high for the stablecoin with its thirteenth consecutive monthly increase in market capitalisation. The market dominance of USDT is currently at 69.2%.

● The market capitalisation of USD Coin (USDC) rose 3.18% to $35.6bn, recording the highest market capitalisation since February 2023. Maker DAO’s DAI saw its market cap fall by 2.83% to $5.10bn as a result of partial conversion to the stablecoin issuer’s new stablecoin Sky Dollar (USDS).

● Meanwhile, First Digital USD (FDUSD) saw its market capitalisation rise by 8.48% to $2.69bn, recording the second consecutive monthly increase. As a result, the stablecoin has regained its position as the fourth largest stablecoin in the industry by market capitalisation.

Stablecoins: Trading Volume

● In September, the trading volume for stablecoin pairs on centralised exchanges fell 39.4% to $683bn (as of the 23rd). Trading volumes are on trend to record a lower trading volume this month as markets recover from the early sell-off with the Federal Reserve cutting interest rates for the first time since March 2020. September also marks the end of seasonality effects and is often followed by increased trading activity in the coming months.

● USDT continues to dominate the trading activity on centralised exchanges accounting for 77.2% market share among the top stablecoins on centralised exchanges. FDUSD remained the second most traded stablecoin with its market share now accounting for 11.6%, followed by USDC with 10.9%.