The third quarter of 2024 noticed a surge in stablecoin use and adoption, based on Coinbase’s 4th Quarter Information to Crypto Markets report with Glassnode.
Stablecoins hit an all-time excessive market capitalization of almost $170 billion in Q3 2024, based on the report. This development occurred alongside the implementation of the European Union’s new Markets in Crypto-Property regulation, which launched clearer guidelines for stablecoin operations.
Stablecoins have change into a key device for customers looking for sooner, cheaper, and safer transactions. Their utility in fee programs, together with remittances and cross-border transfers, has continued to increase.
Not too long ago, Anthony Pompliano argued that tech improvements exterior of crypto may result in a brand new period wherein stablecoins change into the first transaction medium in a machine-driven economic system. This elevated adoption displays the rising position of stablecoins in crypto buying and selling and real-world monetary programs.
In accordance with the report, stablecoin volumes have reached almost $20 trillion year-to-date as of the third quarter, indicating their rising position within the world economic system.
Stablecoin and Bitcoin dominance
Stablecoin dominance additionally elevated in Q3 alongside Bitcoin (BTC), with crypto traders gravitating towards what they see because the highest-quality digital property.
The present BTC cycle intently tracks the 2015-2018 and 2018-2022 cycles, which ended with almost 2,000% and 600% returns, based on the report.
What’s MiCA?
The Markets in Crypto-Property Regulation is a complete framework enacted by the European Union in June 2023 to control the crypto trade throughout its 27 member international locations. It initiates a 12-18 month transition interval for implementing guidelines on anti-money laundering, combating the financing of terrorism and digital asset custody, amongst others.
MiCA’s impression on stablecoins nonetheless stays to be seen, however Tether (USDT) CEO Paolo Ardoino expressed concern that MiCA’s 60% money reserve requirement for stablecoins may create systemic dangers for European banks. He argued that such rules would possibly exacerbate liquidity points throughout large-scale redemptions, doubtlessly resulting in financial institution failures.
