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Highlights
- Stablecoins recorded $846 billion in on-chain trading volume in May, despite a 30% drop from the previous month.
- The total supply of stablecoins is $20 billion below its peak, yet the market remains active.
- Stablecoins are increasingly recognized as a cost-effective option for international transactions.
Stablecoins maintained a substantial presence in the cryptocurrency market, with $846 billion in on-chain trading volume this May, despite a 30% monthly drop. The total supply of stablecoins remained $20 billion below its peak, signaling robust market activity amid fluctuations.
Stablecoins Gain Ground in Remittance Market
IntoTheBlock, an on-chain data platform, revealed in its latest “On-chain Insights” newsletter the growing acceptance of stablecoins in reducing international remittance fees. A recent Coinbase study highlighted that Americans spend nearly $12 billion annually on fees for sending money overseas. Moreover, stablecoins are now considered a viable solution to these exorbitant costs, offering a more economical alternative for global transactions.
Additionally, PayPal’s new stablecoin, PyUSD, has quickly gained traction. With a market cap approaching $400 million, it became the tenth-largest stablecoin. In April alone, PyUSD saw a 21% increase in value, showcasing its rapid growth and acceptance within the financial ecosystem.
PayPal Integrates PyUSD with Solana Blockchain
PayPal announced the integration of its PyUSD into the Solana blockchain on May 29th. Previously limited to the Ethereum network, this expansion allows PyUSD to capitalize on the over $3 billion stablecoin market cap within the Solana ecosystem. Currently, USD Coin (USDC) dominates this market, holding more than 72% of the total market share.
This development followed PayPal’s April announcement that its money transfer service, Xoom, would enable customers in the U.S. to send stablecoins to approximately 160 countries without incurring fees. This initiative marks a significant milestone in leveraging blockchain technology for financial inclusivity and efficiency.
USDT Leads with $654 Billion in Trades
Despite the impressive trading volumes, the stablecoin market faces skepticism from financial institutions. Deutsche Bank recently issued a cautionary note after studying 334 currency pegs, finding that only 14% have historically survived. Their analysis suggests that while some stablecoins will persist, the majority may need help to maintain their pegs.
Conversely, major market players remain optimistic. For instance, Ripple predicts the stablecoin market could surge to $3 trillion by 2028. In the last 30 days, Tether USD (USDT) led the market with $654 billion in transactions, followed by MakerDAO’s DAI and USD Coin, which processed $394 billion and $321 billion, respectively. These figures reinforce stablecoins’ significant role in the digital currency landscape, accounting for 94.53% of the total 24-hour crypto market volume at $71.25 billion.
Also Read: Ripple CEO Brad Garlinghouse Triggers ‘Fire Gensler’ Debate On X
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