Stablecoin Supply Hits Record $176.2B Amid Market Recovery

The total stablecoin supply reached an all-time high of approximately $176.2 billion.

According to data compiled by Token Terminal, stablecoin supply has steadily recovered after a decline from mid-2022 through early 2023, which likely mirrored broader market retracements during the crypto winter.

Since then, the aggregated supply has shown consistent growth.

Stablecoin Market Cap Growth After Trump’s Win

While the overall stablecoin supply has reached new heights, top such assets have also seen significant growth in their market cap. In fact, data compiled by CoinMarketCap shows that Tether (USDT) experienced a market cap increase of over 7%, adding $8 billion since November 5th, while Circle’s USDC grew by almost 6%, with nearly $2 billion in additions during the same period.

Stablecoins, typically pegged to the US dollar, are essential for liquidity in crypto markets, acting as a reserve to purchase assets. USDT is the most traded one on offshore exchanges, while USDC is widely used on platforms like Coinbase and DeFi networks in the US.

Growth in the stablecoin market cap reflects increased demand for liquidity and trading activity. This trend is often viewed as a precursor to market expansion. Investors holding stablecoins are essentially keeping “dry powder” ready for deployment which is essentially a signal of confidence in the market.

USDT Netflow Hits Over 1.8B

Alongside growing market cap, CryptoQuant’s latest analysis also revealed that USDT netflow to exchanges has reached a new record of over 1.8 billion. This surge in stablecoin inflows signals a considerable increase in buying power. Such a pattern suggests that investors are gearing up for potential market moves.

“The substantial inflow of stablecoins onto exchanges brings a high amount of purchasing power, which could drive demand for Bitcoin and other cryptocurrencies, especially if this capital is deployed strategically.”

During this time, the broader digital asset economy saw a dramatic increase in activity, with Bitcoin hitting all-time highs following Donald Trump’s election win. The anticipation of a crypto-friendly administration fueled optimism, driving a wave of excitement and investment across the market.