Cointelegraph Team
Cointelegraph
USDC has grown much faster than Tether (USDT) in 2021 and it is emerging as the dominant stablecoin on Ethereum thanks to its popularity in DeFi according to Messari.
Research by the analytics firm revealed that the demand for USD Coin has grown so much that it has consumed a large chunk of Tether’s market share this year.
Researcher Ryan Watkins predicted that in the coming weeks, this could result in Tether' share of the stablecoin supply on Ethereum falling below 50%.
He added that over half of the total USDC supply now sits in smart contracts, which is equivalent to around $12.5 billion. Citing data from CoinMetrics, Messari estimates that more than 40% of the stablecoin supply on Ethereum is USDC.
Watkins stated that the Circle stablecoin has now become the preferred dollar-pegged asset staked in smart contracts in DeFi protocols.
“Although this percentage is not as high as DAI, USDC leads by a wide margin in dollar terms and has become the preferred stablecoin in DeFi for now.”
The USDC supply has surged by more than 1,820% since the beginning of 2021 when there was just 1.3 billion circulating. Currently, the supply of the stablecoin is at a record 25 billion according to Circle.
According to the Tether transparency report, there are 62.7 billion USDT in circulation, an increase of around 200% since the beginning of the year. Of that total, 30.9 billion is currently on the Ethereum network, a figure that has been falling with regularity this year as high network fees have hampered transactions.
The researcher reported that DeFi lending protocols MakerDAO, Compound, and Aave are the largest consumers of USDC, holding around 23% of the total supply.
He added that the trend is likely to continue with the pending launch of Compound Treasury, a new product offering 4% interest on USDC to institutions, and initiatives centered on Circle’s DeFi API, a new platform to ease DeFi operations for businesses.
Earlier this week, U.S. crypto exchange Coinbase also announced that it would pay 4% interest on USDC holdings adding further momentum to the stablecoin.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.
Recommended Content
Editors’ Picks
Top 3 gainers Supra, Cosmos Hub, EOS: Supra leads recovery after Trump’s tariffs announcement
Supra’s 25% surge on Friday calls attention to lesser-known cryptocurrencies as Bitcoin, Ethereum and XRP struggle. Cosmos Hub remains range-bound while bulls focus on a potential inverse head-and-shoulders pattern breakout.
Bitcoin Weekly Forecast: Tariff ‘Liberation Day’ sparks liquidation in crypto market
Bitcoin price remains under selling pressure around $82,000 on Friday after failing to close above key resistance earlier this week. Donald Trump’s tariff announcement on Wednesday swept $200 billion from total crypto market capitalization and triggered a wave of liquidations.
Can Maker break $1,450 hurdle as whales launch buying spree?
Maker is back above $1,300 on Friday after extending its lower leg to $1,231 the previous day. MKR’s rebound has erased the drawdown that followed United States President Donald Trump’s ‘Liberaton Day’ tariffs on Wednesday, which targeted 100 countries.
Gold shines in Q1 while Bitcoin stumbles
Gold gains nearly 20%, reaching a peak of $3,167, while Bitcoin nosedives nearly 12%, reaching a low of $76,606, in Q1 2025. In Q1, the World Gold ETF's net inflows totalled 155 tonnes, while the Bitcoin spot ETF showed a net inflow of near $1 billion.
Bitcoin Weekly Forecast: Tariff ‘Liberation Day’ sparks liquidation in crypto market
Bitcoin (BTC) price remains under selling pressure and trades near $84,000 when writing on Friday after a rejection from a key resistance level earlier this week.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.