Supply Contractions Hit Nine of the Top Ten Stablecoins in August
In the last 30 days, the stablecoin market has witnessed a significant decline in nine out of the top ten players by market cap. Among them, BUSD experienced the most substantial dip, plummeting by 16.6%. As August drew to a close, the collective value of these stablecoins barely held above the USD 125 billion mark, continuing the trend of monthly declines seen throughout the year.
The Stablecoin Market Witnesses Collective Decline
The current stablecoin market size stands at USD 124.54 billion. Following the pattern of previous months, August saw a contraction in the supply of numerous projects. Tether (USDT), reigning as the heavyweight in the stablecoin market, boasts an impressive valuation of around USD 82.88 billion.
However, USDT witnessed a 1.1% drop in its circulating supply over the last 30 days. Circle's USD Coin (USDC) also experienced a decline of 1.4% this month, while MakerDAO's DAI faced a 6.4% contraction in its monthly supply. USDC's market cap hovers around USD 26.13 billion, with DAI following at USD 3.89 billion.
Though DAI's supply is just under 4 billion, BUSD is on the verge of slipping below the USD 3 billion mark. BUSD notably reduced its supply by 16.6% in the past month, while TUSD reported a 3.8% decrease in circulation. Amid August's decline, FRAX experienced the smallest reduction among the top ten, shedding only 0.6%.
FDUSD Defies the Trend and Surges Over 40%
Tron's USDD and Pax Dollar (USDP) saw monthly declines of 2.5% and 8.3%, respectively. In a contrary move, the newcomer First Digital USD (FDUSD) defied the trend, expanding its supply from 232 million at the beginning of August to 327 million FDUSD by the end of the month, registering a remarkable growth of over 40%.
During the past month, the Gemini Dollar (GUSD) experienced a 14% contraction in supply, while Liquidity USD (LUSD) dipped by 2.5%. Despite witnessing yet another month of consistent declines, some more substantial than others, USD-pegged stablecoins remain dominant in trading volume within the cryptocurrency sector.
For instance, out of the total USD 36.92 billion traded in the crypto market within 24 hours, a staggering USD 28.65 billion is attributed to stablecoins. Among them, Tether (USDT) alone contributes an impressive USD 18.83 billion to that trading volume.
What is your take on this month's stablecoin activity? Please share your thoughts and opinions in the comments section below.
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