The volume of stablecoin transfers decreased by 19.2% in the week leading up to Sunday. According to data from Dune, BUSD has led to a decline in volume.
The decline was fueled by a 353.3% weekly decline in BUSD usage on Binance. This is just the most recent decline in the stablecoin’s general downward trend over the past few months.
In addition to declining transaction volume, BUSD’s market capitalization has also been declining. The quantity of BUSD in circulation fell below $7 billion on April 15, signifying the lowest level since April 2021.
Binance The USD is not the only stablecoin with limited demand. The quantity of other key tokens like USDC and TUSD, which are tied to the dollar, has also been decreasing.
BeInCrypto reports that the market capitalization of the top four stablecoins has decreased by 23% since their peaks. Since their respective maxima, the supply of USDC and BUSD has decreased by $20 billion and $11 billion, respectively. While less severe, there has also been a $1.3 billion decline in TUSD and a $4.4 billion drop in Dai supplies.
It must be noted that the various market capitalization peaks of stablecoins occurred during a broader crypto bear market that saw an investment transition towards less volatile assets. Once representing close to half of all crypto investments, stablecoins now account for approximately 10% of the total crypto market capitalization. In 2023, however, liquidity has shifted to BTC and ETH.
The U.S. Securities and Exchange Commission’s (SEC) prospective enforcement action against BUSD issuer Paxos looms large over its future.
In the weeks that followed the mid-February announcement of the SEC investigation, BUSD supply decreased by 60%.
According to market capitalization data compiled by BeInCrypto, BUSD is now ranked thirteenth among cryptocurrencies. Shiba Inu briefly surpassed Binance’s dollar-pegged token earlier this week, as a series of altcoins outperformed it.