Stablecoins market cap sees 14-month consecutive increase to 2-year high of $190 billion

The market cap for stablecoins surged 9.94% in November, according to CCData report. This marks the fourteenth consecutive monthly increase in the stablecoin market cap and the highest month-to-month increase since November 2021.

With this increase, the stablecoins market cap has reached $190 billion, its highest ever. This beat the previous all-time high in April 2022, just before Terra UST collapsed.

The record market cap and upward trend highlight how the adoption of stablecoins has increased substantially over the past year. With the crypto market in full recovery mode and Bitcoin setting new highs, the use of stablecoins as a trading pair for cryptocurrencies has also boosted its overall trading volume.

According to the CCData report, trading volume increased by 77.5% in November, reaching $1.81 trillion as of November 25. At this rate, stablecoins’ trading volume on centralized exchanges for November will surpass the yearly high set in March.

The report said:

“Trading volumes on centralised exchanges are on track to record a yearly high, buoyed by the heightened institutional confidence in the asset class with the industry braced for a period of favourable regulation under the new US government.”

Despite the rise in the stablecoin market cap, stablecoin market dominance has declined from 7.22% in October to 5.54%. This is the lowest stablecoin dominance since March and is mostly due to the rise in the value of cryptocurrencies, including Bitcoin, which has over 60% dominance.

Tether USDT market cap grows 10% in November

Meanwhile, Tether USDT saw considerable growth in November, with the largest stablecoin growing by 10.5% during the month, reaching $133.3 billion. This represents a new all-time high for the stablecoin, which has now enjoyed 15 consecutive months of increase. USDT dominance now stands at 69.9%.

However, Circle USDC saw more growth during the month, with the stablecoin recording 12.1% gains to $38.9 billion. The gains were enough to give the stablecoin its highest market cap since February 2023, and it now has a 20.5% dominance.

Still, Ethena synthetic dollar USDe was the best performer among all stablecoins, gaining 42% during the month to reach a record $3.86 billion. However, the good fortunes did not go around. First Digital USD (FDUSD) and Sky Dollar (USDS) both saw significant declines in their market caps, dropping 14.9% and 8.34% to $1.90 billion and $950 million, respectively.

These declines were exceptions rather than the norm, as 38 out of the total 198 stablecoins analyzed in the report actually reached new all-time highs.

Meanwhile, USD-pegged stablecoins continue to dominate the stablecoin sector after the market Euro stablecoins fell 11.4% in November to $256 million. This decline ends the four months of consecutive gains for the Euro-pegged stablecoins and could be due to some issuers sunsetting their stablecoins with Market in Crypto Assets (MiCA) rules set to become effective by the end of the year.

However, the European stablecoin market is seeing interest from stablecoin giants such as Tether and Paxos, who now want to participate with MiCA-compliant stablecoins. Tether invested in the licensed Dutch firm Quantoz to gain access to the European market and will now issue two compliant stablecoins, USDQ and EURQ, for the region. Tether has already stopped minting its own EURT and will end support for it by November 2025.

Meanwhile, Paxos also bought Finland-based E-Money institution Membrance Finance, enabling it to become fully licensed to issue regulated stablecoins in the region.

CBDCs see more adoption in November

Stablecoins are not the only digital money gaining mass adoption. Central Bank Digital Currencies (CBDCs) also saw major adoption in November. In China, phone manufacturer Huawei announced that it has integrated the Chinese digital Yuan into its Harmony OS NEXT, giving a potential over one billion users access to the currency.

Meanwhile, several countries are also making strides with CBDC adoption, with Pakistan, South Korea, Australia, Norway, India, Israel, and Brazil all initiating pro-CBDC moves during the month. The Bank of Korea has now signed an agreement to test CBDC while blockchain-based Kima Network completed the first transfer of tokenized shares using Israeli digital shekel.

The Bank of International Settlements also confirmed during the month that its cross-border CBDC initiative, mBridge, has reached a minimum viable product (MVP) stage.

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