The total stablecoin market cap is falling dramatically, with a drop of over $50 billion over the past 14 months. However, Tether still has the upper hand over its competitors, its highest market share since December 2021.
According to Defillama, the stablecoin market cap currently stands at $129 billion, down from over $186 billion in May 2022 when Terra UST was depeg.
STABLECOIN’S MARKET CAPITAL DECREASE FOR 14 CONTINUOUS MONTHS
At this rate, the market capitalization of this group of altcoins is at its lowest level since September 2021, according to CCData.
Stablecoin overview. Source: DeFillama
Even before the UST collapsed, the stablecoin market experienced a decline. After that, the event from UST continued to accelerate the downward momentum. CCData reported that the total market capitalization of stablecoins fell 0.45% in May, the 14th consecutive month of decline.
Stablecoin volume reduction. Source: CCData
Besides the decrease in market capitalization, the trading volume of this asset also decreased significantly in May. Specifically, stablecoins overall saw a 40.6% drop in trading volume to $460 billion. This is the lowest trading volume on centralized exchanges since December 2022.
Meanwhile, declining trading volume and market capitalization have no effect on dominance. Stablecoin’s market dominance has increased to 11.1% from 9.76% in April — though this is still below the all-time high of 16.6% recorded in December 2022.
Tether USDT STILL DOWN
Tether’s USDT is the largest stablecoin by market cap and controls 63.9% of the market, the highest market share since December 2021. According to Coinmarketcap data, the stablecoin’s circulating supply stands at $83.2 billion — closer to an ATH of $83.7 billion.
The issuer recently reported a reserve in excess of $2.4 billion, adding that it will use 15% of its realized net operating profit to buy Bitcoin.
Meanwhile, other stablecoins such as TrueUSD (TUSD) and Gemini Dollar (GUSD) have seen their market capitalizations increase. The market capitalization of GUSD increased 18.4% to $576 million, while TUSD increased 3.82% to reach an ATH of $2.07 billion.
BUSD, USDC DECREASE MARKET SHARE
However, other major stablecoins have slipped in their market capitalization. The market capitalization of Binance USD (BUSD) has declined for the sixth consecutive month as Paxos continues to steadily decline the digital asset. BUSD fell 11.9% to $5.48 billion.
Additionally, the Circle-Backed USD Coin (USDC) also recorded a 3.5% drop in market capitalization and has now dipped below $30 billion. Investor confidence in USDC dropped after it revealed it had $3.3 billion stuck in Silicon Valley Bank.