In 2024, Circle’s USD Coin (USDC) outperformed other stablecoins in terms of market cap growth. After suffering a huge setback in 2023, when its market capitalization fell by 45% due to the failure of Silicon Valley Bank, USDC rebounded with a 78% gain in circulation, climbing from $24.4 billion to $43.9 billion by year-end.
Despite this strong rebound, USDC’s market capitalization remains 22% below its all-time high of $55.9 billion, set in mid-2022. The previous year’s issues, particularly Circle’s inability to access a portion of its $40 billion reserves kept at Silicon Valley Bank, resulted in the coin’s temporary depegging. However, the stablecoin’s outstanding performance in 2024 shows its durability and comeback.
Tether’s USDT, the market’s main stablecoin, also experienced a tremendous increase within the same time period, with its market capitalization jumping by 50%, from $91.7 billion to $137.5 billion. Unlike USDC, USDT’s growth in 2024 was more gradual, as it expanded on its current dominance. Since late 2020, USDT’s market capitalization has increased by 552%, while USDC has increased by 1,135% within the same time period.
Circle credits USDC’s growth to a number of causes, including improved legislative certainty in major areas and the scalability of blockchain technology. Regulatory developments, like the European Union’s Markets in Crypto Assets Regulation (MiCA), have played an important role in boosting confidence and acceptance, particularly in places where stablecoins like USDC are becoming more integrated into existing financial institutions.
In addition to the regulatory environment, USDC’s extensive acceptance across many blockchains and use cases in remittances and cross-border payments has accelerated its growth. Despite encountering hurdles, Circle’s stablecoin has established itself as a top digital asset with outstanding growth potential as the digital currency industry evolves.
