What happened?
Ethereum’s stablecoin supply has hit a new record of $165 billion, having added about $5 billion in new tokens over the past week. This growth occurred despite the fact that Ethereum’s on-chain revenue fell by 44% month-over-month to $14.1 million in August. The data also shows that Ethereum was adding approximately $1 billion in stablecoins each weekday during this period.
Who does this affect?
The increasing supply of Ethereum’s stablecoins affects the overall cryptocurrency market and specifically impacts those who maintain investments or conduct transactions with stablecoins. Companies investing in blockchain infrastructure like Etherealize, which raised $40 million in September to promote Ethereum adoption, are also affected. Additionally, centralized exchanges have felt the impact, with their stablecoin reserves hitting a global total of $68 billion.
Why does this matter?
This matters because the growth of Ethereum’s stablecoin supply is indicative of a broader trend towards decentralized finance and the increasing acceptance of stablecoins as digital assets. It also signals market confidence in the Ethereum platform, despite declining network revenues, underlining its potential for further development in the financial sector. Lastly, such developments could prompt more companies to invest in Ethereum and blockchain infrastructure, thereby potentially affecting market dynamics in the future.