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The surprising truth behind stablecoin demand: A steep drop contradicts industry expectations
Stablecoin demand myth busted: surprising data reveals the untold story behind exchange balances and Ethereum gas usage.
This article was published 3 years ago. Some details may no longer reflect current market conditions or recent developments. If you spot anything that needs an update, contact us.
Quick Take
- Stablecoin demand looks extremely weak — especially in this current market environment.
- Patrick Hansen from Circle believes the stablecoin demand is growing. However, the data indicates that this is not the case.
- Stablecoin balance on exchanges has dropped considerably from its peak in November 2022. From $44 billion to under $22 billion — which has either been converted for fiat or Bitcoin.
- Next, gas usage on Ethereum for Stablecoins has also considerably dropped since the SVB collapse in March. This represents just 6% of the total gas usage from 7.5%.
- While according to Kaiko research, TUSD now accounts for 10% of global stablecoin trade volume on centralized exchanges. Nearly all this volume is from the BTC-TUSD pair on Binance — which has zero fees.
