Mapping the Use Cases Driving Stablecoin Adoption

Key Insights

• Centralized exchanges dominate stablecoin holdings, but this use case is hard to access through public investment vehicles.
• Protocols like Ethena and Maker are gaining traction by offering higher yields, but still capture only a small share of the total fee opportunity.
• Adjusted stablecoin volumes are rising, but flat velocity suggests limited evidence of genuine growth in payment usage.
• The store-of-value use case in emerging markets faces future competition as access to tokenized assets broadens.

Stablecoins, one of the earliest narratives in crypto, have recently regained attention as a category that appears to be achieving product-market fit. Over the past two years, total stablecoin market cap has increased by more than 75%, reaching over $233 billion, with growth that has been largely uninterrupted. There have been few material drawdowns, with the notable exception of early 2023 when USDC briefly lost its peg following concerns around exposure to Silicon Valley Bank. Prior to that, the collapse of Terra’s UST in 2022 marked a separate, more structural failure in the design of an algorithmic stablecoin. Outside of these events, stablecoin supply growth has been relatively stable across market cycles.