Stablecoins Smash $231B Milestone—But the Party’s Slowing Down

Stablecoins just bulldozed past $231 billion in market cap—proof that crypto’s ’boring’ corner still prints money. But growth is cooling faster than a Wall Streeter’s interest in ethics.

What’s next? The usual suspects: tighter regs, Tether’s dominance, and the eternal question—when does ’stable’ start meaning something?

For now, enjoy the irony: the least volatile crypto asset is stuck in a volatility paradox. Traders still need it, banks still fear it, and the SEC? Probably drafting another strongly worded tweet.

Liquidity climbs along with uncertainty

Despite the surge in stablecoin supply to an all-time high of $231 billion, the composition of growth shows a fragmented picture.

USDT continues to dominate, while newer entrants like FDUSD and PYUSD remain relatively thin in market share.

Source: Alphractal

While there’s broad liquidity in the system, it’s not flowing evenly — potentially a sign of selective market confidence rather than a full-blown bullish wave.

Stalling momentum on the 90-day change

While the aggregate stablecoin market is expanding, the 90-day change shows a recent decline, hinting at hesitation from capital allocators. This dip in inflows aligns with periods of consolidation in altcoin markets, showing a lack of aggressive risk appetite.

Source: Alphractal

It’s not a full reversal — but it could mark the top of a cycle unless inflows pick up soon. Historically, such pauses precede either an acceleration or a plateau in market prices.

Patterns mirror 2021

The current structure of stablecoin inflows, particularly the stall in the 90-day momentum, resembles the early plateau seen in mid-2021, just before stablecoin expansion surged again and drove Bitcoin to new highs.

If history repeats, a renewed uptick in stablecoin growth could act as the fuse for a broader market rally. But until then, caution prevails.