### What happened?
Stablecoin liquidity is still growing, but the growth rate has significantly slowed down. Recent weekly expansions in stablecoin market capitalization have been around $1.1 billion, much less than the $4–8 billion weekly inflows seen in late 2024 that boosted Bitcoin’s momentum. While Tether’s USDT remains dominant, its growth has moderated to around $10 billion, indicating a cooling trend in capital inflows.
### Who does this affect?
This slowdown affects traders and investors in the cryptocurrency market who rely on stablecoin liquidity for trading and investment activities. With stablecoin exchange reserves reaching a record high of $68 billion, traders and institutions still have substantial liquidity on hand for potential market moves. Binance continues to dominate in altcoin and stablecoin deposits, indicating its significant role in the market despite the slowdown in new stablecoin issuance.
### Why does this matter?
The slowing pace of stablecoin growth impacts the overall crypto market by reducing the liquidity tailwinds that previously fueled bullish market phases. Despite the slowdown, the high levels of stablecoin reserves on exchanges suggest potential for market activity and opportunistic moves. The combination of slower issuance and high exchange reserves may lead to market consolidation rather than explosive rallies, signaling a shift towards stability and selective growth opportunities.