The digital dollar, crypto dollar or Bitcoin dollar once again had a market stumble. The market capitalization of USD Coin (USDC), a stablecoin issued by US payment technology company Circle, fell below $50 billion for the first time since January 2022 .
USDC 's market capitalization fell to $49.39 billion, which is almost 12% lower than its all-time high of $55.88 billion , set just three months ago.
For their part, other stablecoins also show mixed indicators. The market capitalization of Tether (USDT), which was at risk of losing its position as the largest stablecoin against USDC in May, surpassed $68 billion on September 26, although it is still 17.4% lower than its USD all-time high. 82,330 million in May of this same year .
BITCOIN DOLLAR IS FROZEN
Since the Terra/Luna crash in May the market cannot recover and the major stablecoins by market cap fell 10.66% from $171.37bn to $153.09bn .
Following its boom in 2020, the stablecoin economy has seen slow growth over the past few months . By April 2022, the segment approached $200 billion for the first time ever, but $35 billion was lost after the fall of Luna/Terra . On May 12, 2022, the stablecoin economy was 10.66% larger than it is today. $171.37 billion .
This means that the stablecoin market has been stagnant in terms of growth for the last 80 days .
WHY USDC FALLS
Binance, one of the world's largest exchanges, announced in early September that it would convert its users' USDC balances into its own stablecoin, Binance USD (BUSD). The conversion will start on September 29 and does not apply to USDT .
The firm claims that it seeks to “improve liquidity and capital efficiency for users” through what appears to be a forced conversion in an increasingly competitive stablecoin sector. Thus, Binance suspended spot, future and margin trading in USDC .
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