The global stablecoin supply decreased by 18.8 percent at the end of the second quarter of 2022. Equities markets and risk assets encountered unstable times owing to increasing inflation and other macro issues.
Stablecoins are digital tokens tied to fiat currencies such as the US dollar. Using blockchain technology, these tokens are backed by a combination of cash reserves, commercial holdings, and other real-world assets.
In research released this week, Arcane Research uncovered the supply trend. The analysis by Arcane analysed supply statistics for prominent tokens, including USDT, USDC, BUSD, DAI, MIM, USTC, and others.
In May 2022, data indicated that the overall supply exceeded $180 billion. This sum decreased to $151.3 billion at the end of the second quarter, marking an 18.8% decline in worldwide supply.
According to the research, this is the most significant quarterly decline in stablecoin history, with a value of almost $35,1 billion. This occurs when crypto markets are in a downturn, and market leaders like Bitcoin have witnessed substantial asset price declines.
Circle’s USDC Is Likely To Surpass Tether’s USDT In Stablecoin Market Capitalization
Notably, Arcane’s research anticipates USDC’s ascent to the top. According to the estimate, USDC’s market value will increase by around USDT in October 2022.
At press time, the two most prominent stablecoins in cryptocurrency are USDT and USDC. Both coins have a market capitalization above $50 billion. The nearest rival, Binance USD (BUSD), ranks third with a market worth of around $17.83 billion.