- Stablecoin market cap peaked at $311.332B on Jan 18 and is $309.066B now; USDT tops $187B, USDC near $74B, with USD1 on Ethereum near $1.3B.
- Market stress persists with Bitcoin below $90,000 and $520M in liquidations; Myriad users see 98% odds the cap stays under $360B next month.
The stablecoin market cap has reached a new high even as broader crypto prices remain under pressure. Data from DeFiLlama shows stablecoin supply peaked at $311.332 billion on January 18 and has since eased to $309.066 billion. The move comes during a period of market turbulence that has pushed traders toward assets designed to hold a steady value.
Stablecoin market cap rises while crypto markets struggle
Nic Puckrin, a digital asset analyst and co-founder of Coin Bureau, said the stablecoin market cap continues to expand despite weakness in the overall digital asset market. In comments to Decrypt, he tied the trend to traders looking for a buffer against volatility, describing how an “altcoin rout” is driving flows into stablecoins. He also said traditional finance’s efforts to enter digital assets are continuing, even as crypto market sentiment remains soft.
The stablecoin rally is unfolding while Bitcoin is trading below $90,000, down nearly 30% from its October peak, according to CoinGecko data. Over the last 24 hours, CoinGlass reported $520 million in total liquidations, with $227 million from long positions and $294 million from shorts. Liquidations were concentrated in the two largest assets, with more than $192 million tied to Bitcoin and over $189 million tied to Ethereum, reflecting elevated caution among traders.
Puckrin also argued that stablecoins have a growing role beyond trading strategy. He said that, with global confidence in the U.S. and the dollar weakening, stablecoins are becoming strategically important. He added that he expects the stablecoin market cap to keep expanding “this year and beyond,” regardless of how the wider crypto market performs.
Issuers and supply shifts shaping the stablecoin market cap
Tether’s USDT remains the largest stablecoin by circulation, with more than $187 billion outstanding, based on CoinGecko data. Circle’s USDC follows at approximately $74 billion. While these figures highlight the market’s leading issuers, another analysis suggests the most recent peak has been influenced by more specific supply increases rather than broad-based growth across all major stablecoins.
Yaroslav Patsira, Fractional Director at CEX.IO, told Decrypt that the latest high was mainly driven by growth in World Liberty Financial’s USD1 stablecoin, which he described as Trump-backed. DeFiLlama data shows USD1 supply on Ethereum increased from $660 million to nearly $1.3 billion over the past month. Patsira added that most other large stablecoins recorded only small supply adjustments.
He pointed to a broader slowdown in issuance. According to Patsira, fourth-quarter growth was $8.1 billion, which he described as the weakest quarterly expansion since Q4 2023. He attributed the softer pace to a risk-off environment and a decline in the supply of crypto-backed stablecoins. In his view, the new record is not a major turning point, because total stablecoin supply has largely been moving sideways, with specific areas of expansion accounting for most of the movement.
Policy backdrop and market expectations
Regulation also remained in focus following comments from President Donald Trump at the World Economic Forum in Davos. Trump said Wednesday that he hopes to sign a crypto market structure bill “very soon.” The remarks followed last week’s legislative turmoil involving the CLARITY Act, after Coinbase withdrew support. The exchange’s reversal was linked to concerns about provisions that could restrict its ability to offer stablecoin yield products, a development that led the Senate Banking Committee to pull a key vote.
Market expectations captured on prediction market Myriad, owned by Decrypt’s parent company Dastan, suggest traders see limited near-term upside for both stablecoins and risk assets. Myriad users assign a 98% likelihood that the stablecoin market cap will not exceed $360 billion next month. On the question of a broader crypto rebound, users put the probability of an “alt season” happening in the first quarter of 2026 at 14%.
Conclusion
With supply near record levels and risk sentiment still fragile, the stablecoin market cap is holding close to its January peak even as Bitcoin trades below $90,000 and liquidations remain heavy. Analysts cited both volatility-driven demand and targeted supply growth—especially USD1’s expansion on Ethereum. as key forces behind the latest data, while regulatory uncertainty continues to shape how major firms approach stablecoin-related products.
Disclaimer
The information provided in this article is for informational purposes only and should not be considered financial advice. The article does not offer sufficient information to make investment decisions, nor does it constitute an offer, recommendation, or solicitation to buy or sell any financial instrument. The content is opinion of the author and does not reflect any view or suggestion or any kind of advise from CryptoNewsBytes.com. The author declares he does not hold any of the above mentioned tokens or received any incentive from any company.
Featured image created by AI
