Stablecoin

2024

Bitcoin

when

USDC

The stablecoin market capitalization reached a record high following a period of consistent growth since mid-2023, according to data from Alphractal.&nbsp;The data analysis platform&nbsp;<a href="https://x.com/Alphractal/status/1885228807969243381" rel="noopener noreferrer nofollow">reported</a>&nbsp;on Jan. 31 that the stablecoin market cap rose 73% from $121.18 billion in August 2023 to reach an all-time high of $211 billion, while USDC (<a href="https://cointelegraph.com/usdc-price-index" rel="noopener noreferrer nofollow">USDC</a>)&nbsp; has been gaining an edge over other stablecoins.<figure><img alt="Stablecoin market cap surpasses $200B as USDC dominance rises" src="https://s3.cointelegraph.com/uploads/2025-01/0194bc54-6c27-73f4-80af-5430bd4c1825" title=""><figcaption>Stablecoin market capitalization. Source: Alphractal</figcaption></figure>Analyzing the market capitalization of other stablecoins, excluding Tether’s USDT (<a href="https://cointelegraph.com/tags/tether" rel="noopener noreferrer nofollow">USD</a>T) and USDC, the data reveals relatively average growth since 2024.&nbsp;This suggests that <a href="https://cointelegraph.com/learn/articles/usdt-vs-usdc" rel="noopener noreferrer nofollow">USDT and USDC </a>remain the two most preferred stablecoins in the crypto market.<blockquote> “The rest of the market has not grown significantly since 2023, maintaining stable average values.”
</blockquote><figure><img alt="Stablecoin market cap surpasses $200B as USDC dominance rises" src="https://s3.cointelegraph.com/uploads/2025-01/0194bc54-c9a1-7db6-b2ce-c0bde6a55dfc" title=""><figcaption>Stablecoins market cap, excluding USDT and USDC. Source: Alphractal</figcaption></figure>USDT, the largest stablecoin by market cap, recorded an all-time high market cap of $140 billion in December 2023. Its market cap is now at $139.4 billion on Jan. 31, with a market dominance of 63.84%.<h2 id="strong-usdc-gains-momentum-strong">USDC gains momentum</h2>USDC’s market capitalization has been in an uptrend since November 2023.&nbsp;Additional data from CoinMarketCap shows that USDC’s market capitalization has increased by over 120% from a low of $24.1 billion on Nov. 14, 2023, to $53.4 billion at the time of writing.<figure><img alt="Stablecoin market cap surpasses $200B as USDC dominance rises" src="https://s3.cointelegraph.com/uploads/2025-01/0194bc56-812b-73aa-bac0-e9fa3fd61f2b" title=""><figcaption>USDC market capitalization. Source: <a href="https://coinmarketcap.com/currencies/usd-coin/" rel="noopener noreferrer nofollow">CoinMarketCap</a></figcaption></figure>This increase aligns with a rise in demand, with USDC pairs recording an all-time high daily trading volume of $20 billion on Jan. 18. As a result, USDC’s market share by market capitalization has risen significantly to 24.6% on Jan. 31.&nbsp;An earlier report by Cointelegraph <a href="https://cointelegraph.com/news/circle-usdc-beats-tether-usdt-supply-growth-2024" rel="noopener noreferrer nofollow">showed</a> a 78% year-over-year growth in USDC circulation, outpacing the growth rate of all global stablecoins. As of Jan. 31, USDC’s circulating supply is at $53.4 billion, more than double the 2023 low of less than $24 billion, according to CoinMarketCap.&nbsp;Alphractal said that USDC has benefitted from the <a href="https://cointelegraph.com/news/price-analysis-1-29-btc-eth-xrp-sol-bnb-doge-ada-link-avax-xlm" rel="noopener noreferrer nofollow">recent drop in altcoins</a>, with investors converting a large portion of their crypto holdings into USDC.The USDC market spike in 2024 followed a massive drop in 2023 when the stablecoin’s market value shrank as much as 45% following <a href="https://cointelegraph.com/news/silicon-valley-bank-shut-down-by-california-regulator" rel="noopener noreferrer nofollow">Silicon Valley Bank’s (SVB) failure</a>.Related: <a href="https://cointelegraph.com/news/sec-initial-approval-bitwise-bitcoin-ethereum-etf" rel="noopener noreferrer nofollow">Bitwise’s Bitcoin and Ethereum ETF clears first SEC hurdle</a><h2 id="strong-is-the-crypto-cycle-top-in-strong">Is the crypto cycle top in?</h2>USDC’s dominance is around the same level it was at the end of the 2021 bull cycle. This was the beginning of the 2022 bear market that saw Bitcoin’s (<a href="https://cointelegraph.com/bitcoin-price" rel="noopener noreferrer nofollow">BTC</a>) price drop as low as $15,500 in Nov. 2022.Alphractal explained:<blockquote> “If this metric continues to rise, it could be a bearish signal for the crypto market, indicating increased risk aversion. On the other hand, if it declines, it could pave the way for new market highs.”
</blockquote><figure><img alt="Stablecoin market cap surpasses $200B as USDC dominance rises" src="https://s3.cointelegraph.com/uploads/2025-01/0194bc59-116a-7f36-baae-6ea808a110e2" title=""><figcaption>USDC market dominance. Source: Alphractal</figcaption></figure>During the last bull market cycle, USDC supply began rising in May and peaked in March 2022, approximately four months after asset prices peaked.The total stablecoin market cap grew by 177% between April 2021, peaking at $167.5 billion in March 2022.&nbsp;If the current stablecoin market supply continues growing and crypto prices begin to decline, the market may reach its peak over the next few months.&nbsp;On the contrary, a rising stablecoin market cap is usually associated with <a href="https://cointelegraph.com/news/stablecoin-transfer-volume-16x-increase-4-years" rel="noopener noreferrer nofollow">growing investor conviction</a>, signaling the potential for boosted capital inflows. This suggests that the bullish momentum could continue for a few more months.This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Stablecoin market cap surpasses $200B as USDC dominance rises

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