USDC Surpasses USDT in Transactions, Visa Reports

In A Nutshell

In an unexpected development within the stablecoin sector, Visa’s on-chain analytics reveal that Circle’s USD Coin (USDC) has surpassed Tether’s USDT in terms of transaction count. As of April 2024, USDC recorded 166.6 million transactions, edging past USDT’s 163.6 million. This shift marks a significant milestone, given Tether’s dominance as the largest stablecoin by market capitalization, which significantly overshadows that of USDC. Despite this change in transaction volumes, Tether still commands over 68% of the stablecoin market share, showcasing the complex and competitive nature of this digital asset segment.

USDC vs. USDT: A Detailed Examination

The recent data from Visa’s stablecoin analytics dashboard has brought to light a surprising trend: Circle’s USDC is now leading in transaction counts over Tether’s USDT. This development follows a steady increase in USDC’s transaction activity, which began to notably diverge from USDT’s in December 2023.

Market Capitalization and User Base

Despite this shift in transaction volume, Tether continues to hold a significant lead in market capitalization, boasting over $110 billion compared to Circle’s $33.5 billion. This vast difference highlights the varied preferences and uses of stablecoins within the crypto ecosystem. Furthermore, Tether’s USDT maintains a larger user base, with over 34.2 million unique wallets engaging with the currency, in contrast to USDC’s 9.57 million in April 2024.

Volume and Analytics Insights

Visa’s analysis extends beyond USDT and USDC, encompassing a broader look at the stablecoin landscape. The data covers transactions involving other stablecoins like the Paxos dollar (USDP) and PayPal USD (PYUSD), accounting for over $2.3 trillion in transaction volume across more than 352 million transactions in the past 30 days. Visa’s stablecoin analytics dashboard, launched in April, seeks to clarify the stablecoin market’s dynamics by offering comprehensive insights across multiple blockchains.

Understanding Stablecoins

Stablecoins serve as a bridge between traditional fiat currencies and cryptocurrencies, offering a stable value that is typically pegged to a currency like the US dollar. This stability is crucial for traders and investors who wish to avoid the volatility associated with other crypto assets. The total market capitalization of stablecoins stands at over $161 billion, representing about 6.63% of the entire crypto market cap, reflecting their importance in the digital asset ecosystem.

Our Take

The surpassing of USDT’s transaction count by USDC signifies a notable shift within the stablecoin market, underscoring the competitive and evolving nature of this space. While Tether’s USDT still dominates in terms of market capitalization and user base, the rise of USDC in transaction volume highlights its growing appeal and utility among users.

This development may encourage further innovation and adoption of stablecoins, as both companies and users seek more efficient, stable, and secure means of engaging with digital assets. It also underscores the importance of accessible and clear analytics, as provided by Visa’s dashboard, in understanding these trends and making informed decisions in the crypto space.

As the stablecoin landscape continues to expand and evolve, keeping a close watch on these trends will be crucial for investors, traders, and the broader crypto community.