The stablecoin market capitalization has reached a 24-month high of $161 billion in May, following eight consecutive months of growth, according to a new report by cryptocurrency analytics platform CCData.
Market Growth and Decline in Dominance
On May 29, CCData reported that the stablecoin market cap rose by 0.63% from the start of the month, reaching $161 billion. Despite this growth, stablecoin market dominance slightly decreased to 6.07%, down from 7% in March. This decline is attributed to the recovery in the prices of major crypto assets, reflecting improved market sentiment after the unexpected approval of a spot Ethereum ETF in the U.S.
Performance of Top Stablecoins
Among the top ten stablecoins, Athena USDe’s market cap climbed for the fifth consecutive month, increasing by 11.6% to $2.61 billion. This rise is linked to its expanded use as collateral for perpetual trading on Bybit.
Tether (USDT), the largest stablecoin by market cap, reached an all-time high market cap of $111 billion as of May 29, increasing its market cap dominance to 69.3%.
BlackRock’s tokenized fund token, BUIDL, surged 19.6% to $448 million, making it the largest tokenized treasury fund and surpassing Franklin Templeton’s BENJI. BUIDL represents a share in BlackRock’s USD Institutional Digital Liquidity Fund and can be swapped to USDC on a 1:1 basis.
Also Read: Stripe Reintroduces Crypto Payments Using Stablecoins
Circle’s USDC Performance
Circle’s USDC market capitalization increased for the sixth consecutive month to $32.6 billion in May. This rise coincides with increased demand, as USDC pairs recorded an all-time high monthly trading volume in March. USDC’s market share by trading volume has risen for the second month to 8.27%. The report highlighted that USDC has benefited from increased on-chain trading activity on networks like Base and Solana, with the percentage of USDC supply on these chains rising to 9.29% and 7.78%, respectively.
Trading Volume Decline
Despite the market cap increases, stablecoin trading volumes on centralized exchanges fell to a monthly low of $829 billion on May 23. The report noted that trading activity on centralized exchanges historically declines in the two months following the Bitcoin halving event.
Market Recovery
Overall, the CCData report concludes that the total market capitalization of stablecoins has now recovered from the losses incurred since the collapse of the Terra Luna ecosystem and the near-total depeg of the algorithmic stablecoin TerraClassicUSD (USTC), which initiated a seventeen-month downtrend.
