Welcome to In The Stables, a weekly briefing on the most important developments shaping the global stablecoin ecosystem. Each edition delivers clear, data-driven insights into market structure, regulatory momentum, and protocol-level shifts, along with a curated look at supply, flows, and onchain usage trends across the sector.
What’s included this week:
Stablecoin onchain activity diverged this week, with transaction counts rising 8.2% WoW while total settlement volume dipped 2.2%, signaling a shift toward smaller, more frequent transfers.
Capital flows weakened, as stablecoins recorded $2.8 billion in net outflows for the week, extending a broader monthly reversal away from defensive positioning.
Tether launched USAT, its first GENIUS-compliant, U.S.-regulated stablecoin, while Standard Chartered warned that stablecoin adoption could pull up to $500 billion in deposits from U.S. banks by 2028.
Institutional and sovereign use cases continued to expand, highlighted by Iran’s reported use of USDT for trade settlement and Capital One’s $5.15 billion acquisition of Brex to accelerate stablecoin-enabled payments infrastructure.
Yields of The Week
In The News
Jan. 21, 2026 | Iran’s Central Bank Used USDT to Support Rial and Settle Trade
The Central Bank of Iran acquired at least $507 million in USDT over the past year, according to Elliptic. The analytics firm traced the purchases to Iran-linked wallets and said the funds were likely used to support the Iranian Rial and facilitate international trade amid sanctions that cut Iran off from the SWIFT banking system. Most USDT initially flowed through the local exchange Nobitex before the assets moved via cross-chain bridges, DEXs, and centralized platforms, with all identified USDT leaving Central Bank-linked wallets by late 2025.
Jan. 22, 2026 | Capital One Acquires Brex in $5.15B Deal
Capital One agreed to acquire fintech firm Brex for $5.15 billion in a cash-and-stock transaction expected to close in mid-2026, pending regulatory approvals. The acquisition gives Capital One access to Brex’s payments technology and emerging stablecoin infrastructure. Capital One said the deal accelerates its expansion in business payments amid intensifying competition from fintechs.
Jan. 25, 2026 | Sui Group Plans Yield-Bearing Stablecoin
Sui Group Holdings plans to launch SuiUSDE, a native yield-bearing stablecoin built with the Sui Foundation and Ethena. The move marks a shift away from a pure token-treasury model toward stablecoin-driven operating revenue. The stablecoin is expected to launch in early February and will use Ethena’s synthetic dollar technology through a white-label arrangement. Under the proposed structure, most fees generated by SuiUSDE will flow back to Sui Group and the Sui Foundation, with proceeds directed to token buybacks or redeployment into the Sui DeFi ecosystem.
Jan. 27, 2026 | Standard Chartered Warns Stablecoins Could Pull $500B From U.S. Banks
Standard Chartered warned that U.S. dollar-pegged stablecoins could drain about $500 billion in bank deposits by 2028, with regional banks most exposed because of their reliance on net interest margin income. The bank said the GENIUS Act is likely to continue accelerating adoption. Deposit flight depends partly on where issuers hold reserves, but leading issuers such as Tether and Circle keep most reserves in U.S. Treasuries rather than bank deposits, limiting any offset.
Jan. 27, 2026 | Wemade Adds Chainlink to Korean Won Stablecoin Alliance
Wemade added Chainlink Labs to its Global Alliance for KRW Stablecoins (GAKS) to expand the consortium’s oracle and data infrastructure amid South Korea's ongoing debate over stablecoin regulation. Under the partnership, Chainlink will provide data integrity, infrastructure standards, and support for tokenized asset use cases alongside existing GAKS members like Chainalysis, CertiK, and SentBe.
Jan. 27, 2026 | Tether Launches GENIUS-Compliant USAT Stablecoin in the U.S.
Tether launched USAT, its first federally regulated dollar-backed stablecoin designed for the U.S. market. USAT is issued by Anchorage Digital Bank under OCC oversight, while Cantor Fitzgerald serves as reserve custodian and preferred primary dealer. Former White House crypto policy advisor Bo Hines leads the U.S. initiative, with USAT positioned as a compliant alternative to USDT, whose current reserve structure does not fully align with GENIUS Act requirements.
In The Data
The total stablecoin market cap was effectively flat this week, ticking down 0.86% to $308.2 billion. USDT held steady at the top, dipping just 0.25% WoW to $186.3 billion and maintaining a 60.4% market share. USDC saw the largest nominal outflows among majors, falling 5.8% WoW to $72.0 billion and giving up over 1% in market share. USDS also contracted meaningfully, down 7.3% to $6.07 billion. In contrast, USD1 posted a sharp 44.0% WoW gain to $5.0 billion, driven by Binance’s $40M WLFI airdrop and ongoing yield incentives. The rotation lifted its market share from 1.11% to 1.61% in a single week. USDe rose 1.8% to $6.6 billion, while DAI slipped slightly to $4.6 billion. “Others” grew 4.1% to $27.7 billion, suggesting modest tailwind for smaller issuers as liquidity continues to fragment.
Stablecoin transaction activity was mixed this week, with volumes easing while usage continued to expand. Total transaction volume declined 2.2% WoW to $292.5 billion, down from $299.0 billion the prior week, marking a modest pullback following recent strength. Despite the softer volume, overall activity remained high, with monthly average volume up 94.0% MoM, reflecting a structurally higher baseline of stablecoin settlement.
In contrast, transaction counts increased meaningfully. The number of transactions rose 8.2% WoW to 57.5 million, up from 53.1 million last week, and remained up 7.7% on a month-over-month basis. The divergence between rising transaction counts and declining aggregate volume drove a 9.6% WoW drop in average transaction size to $5,090, suggesting a shift toward smaller, more frequent transfers. This pattern points to sustained retail or application-level usage even as fewer large transfers were settled during the week.
Stablecoin flows deteriorated sharply this week, with USD inflows reversing into sizable net outflows. Stablecoins recorded $2.79 billion in net outflows over the week, a 179% WoW swing from the prior week’s $3.52 billion in net inflows. On a daily basis, average flows fell to net outflows of $399 million, down from a $503 million daily inflow last week, underscoring a broad and persistent reduction in stablecoin balances rather than a single-day anomaly.
The weekly drawdown extended an already weak monthly trend. Month to date, stablecoins have seen $854.6 million in net outflows, a sharp reversal from the $2.71 billion in net inflows recorded last month. This represents a 132% MoM swing, signaling a decisive shift away from stablecoin accumulation and toward redeployment into risk assets or off-ramps into fiat.
Overall, the data points to a meaningful cooling in defensive positioning. Unlike weeks characterized by isolated large redemptions, this week’s outflows appear more evenly distributed, suggesting sustained capital rotation rather than a transient shock. Absent a reversal in flows, stablecoin liquidity may continue to act as a headwind for near-term market support.
Author: International Capital Market Association (ICMA)
Summary: ICMA announces and summarizes a new paper assessing whether fiat-backed stablecoins can serve as credible settlement assets in capital markets alongside wholesale CBDCs and tokenized bank money. The paper emphasizes growing regulatory convergence on reserves, safeguarding, and interest prohibitions, and concludes that stablecoins are unlikely to become a universal solution but could take a complementary role in market infrastructure if cross‑border regulatory alignment deepens.
Summary: This Substack essay analyzes the emerging stablecoin card ecosystem, arguing that the key 2026 question is whether pilots can scale under tightening global regulation on reserves, licensing, disclosures, and yield. It highlights regulatory “chokepoints” such as potential limits on issuers to banks or trust companies, caps on transaction sizes, and pressure on yield-bearing programs, framing regulatory outcomes as a binary driver between mass‑market scale and forced retrenchment.
Summary: The article critiques a research paper modeling yield-bearing stablecoins' effects on banking, arguing that their growth inevitably reduces deposits and lending despite temporary phases where issuance threats may boost deposits. It highlights underestimated run risks, disproportionate impacts on traditional banks, and alignments with Federal Reserve analyses predicting credit supply declines of $65 billion to $1.26 trillion, emphasizing the need for regulatory safeguards.
Summary: The piece posits stablecoins as the internet-native future of money, distinct from volatile cryptocurrencies, with market cap exceeding $284 billion post-GENIUS Act regulations. It forecasts growth to $2-3 trillion by 2028, dismisses financial stability threats, and argues banks will adapt rather than collapse, supported by Treasury and Standard Chartered projections on deposit shifts.
Closing Summary
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Alexander is a protocol researcher specializing in Layer-1 and Layer-2 infrastructure, as well as RWA's and Stablecoins. Before Messari, he worked at Jump Trading and Bull-Moose Consulting. He graduated from Northeastern University with a degree in Economics and Data Science, and helped run Northeastern's blockchain club.
Alexander is a protocol researcher specializing in Layer-1 and Layer-2 infrastructure, as well as RWA's and Stablecoins. Before Messari, he worked at Jump Trading and Bull-Moose Consulting. He graduated from Northeastern University with a degree in Economics and Data Science, and helped run Northeastern's blockchain club.
