The stablecoin market has “surged” to an all-time high. It is dominated by dollar-based stablecoins, and Tether is leading the pack with its USDt. The stablecoin market cap has now reached a record $168.07 billion, topping the previous high of $167 billion in March 2022.
Tether reports that it has hoovered up 70.1% of the dollar-based market. At the beginning of the year, Tether had a market cap of $91.69 billion. In August 2024, that number surpassed $117 billion.
Historically, stablecoins have mostly served the crypto market, acting as an on-ramp to digital asset trading. Stablecoins also offer a safe haven from volatility when trading crypto. However, this initial use foreshadows future potential utilization, such as a direct payment option that is immediate and arrives at a lower cost while providing solid security. Today, payments are dominated by legacy rails that can be slow and costly for both consumers and merchants. What is missing is a clear cut regulatory regime – something the US Congress has attempted to do with new legislation which has yet to be approved.