This year, the total market cap of stablecoins has increased by approximately 46%, with this type of cryptocurrency consolidating its more enduring position in global trade.
According to information from the Intelligent Finance and Economics APP, after the infamous 'stablecoin crash event' triggered by TerraUSD in 2022 severely impacted market sentiment, the overall market value of stablecoin markets slowly entered a rising curve and has recently surged to new heights. As per statistics from DeFiLlama, as of last Sunday, the market cap of global stablecoins has significantly increased by 46% this year, surpassing 190 billion US dollars, reaching a historic high.
Stablecoins are also a type of cryptocurrency designed to maintain a long-term price consistency with the legal tender (usually the US dollar). Over time, their main use has been as channels for traders to move funds in and out of other cryptocurrencies. However, an increasing number of investors optimistically believe that with Trump's strong support for cryptocurrency development potentially returning to the White House, stablecoins may play a more significant role in the global business and trade system, especially as stable payment tools for cross-border transactions.
The market cap of stablecoins surpassing the historical record of the Terra era.
Tether, which issued the world's largest stablecoin USDT, has seen its circulating supply soar to nearly 133 billion US dollars, accounting for about 70% of the total stablecoin market. The company hopes to expand the usage of stablecoin USDT by entering more new areas, including commodity trading. It is understood that the company recently announced providing funding support for its first crude oil transaction in the Middle East.
Meanwhile, the fintech giant Stripe, with a market cap of up to 70 billion US dollars, announced in October its plans to acquire the stablecoin-focused startup Bridge for 1.1 billion US dollars, making it one of the largest digital asset startup acquisitions in history. In addition, other traditional fintech companies including PayPal are also venturing into the stablecoin space.
The expectation of these fintech giants fully accepting stablecoins may help avoid the kind of crypto market crash that occurred after the collapse of TerraUSD in May 2022. The collapse event of stablecoins related to the Terra blockchain founded by Do Kwon created a gap of up to 19 billion USD in market value in the stablecoin market. This kind of volatility is very rare for the stablecoin market in maintaining the value stability, and it took more than two and a half years to fill this gap.
The recent surge in the value of stablecoins following the rapid rise in cryptocurrencies such as bitcoin is mainly due to Donald Trump's landslide victory in the US presidential election, triggering a surge in the crypto market. Trump, who once held a skeptical attitude towards the crypto industry, now promises to implement more favorable policies to support the development of the crypto industry. During his campaign, Trump fully embraced digital assets, stating that he aims to make the USA the "capital of cryptos" and a "superpower of bitcoin".
According to CoinGecko's statistics, since the US election, the total value of the crypto market has grown by nearly a trillion USD, surpassing the milestone of 3.2 trillion USD, ranking just below Apple and Nvidia on the global stock list. This implies that if the crypto market is seen as a stock, its market cap is only surpassed by Nvidia and Apple, far ahead of top global listed companies like Amazon, Google, Meta, Tesla, and Saudi Aramco.
The leading cryptocurrency, bitcoin, briefly approached the epic level of 100,000 USD last week but then retraced, with the current trading price hovering around 93,500 USD.
The market cap of bitcoin is currently hovering around 1.8 trillion USD, historically the largest scale cryptocurrency. Recently, Wall Street investment firm Ned Davis Research upgraded bitcoin to a "long-only trading" status, believing that bitcoin is poised to surge above 120,000 USD by next spring. The Global Head of Digital Asset Research at Standard Chartered Bank, Geoff Kendrick, believes that after Trump wins the US presidential election, the price of bitcoin will reach 125,000 USD by the end of this year and 200,000 USD by the end of 2025.
