Stablecoin Market Share is Shrinking While Most Cryptocurrencies Surge
- The sector’s market cap is down 8% since January, CCData shows
- Stablecoin usage usually increases during bull market runs
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One of the more head-scratching phenomenas playing out in the digital-asset world is the shrinking of the stablecoin market while most cryptocurrencies are posting outsized gains this year.
Traders use stablecoins to move money into and out of cryptocurrency markets, swap funds between exchanges and as a haven in times of high volatility. Often the market capitalization of the tokens increases during rallies and declines during downturns. So far this year, the total value of the crypto market has jumped around 50% to about $1.2 trillion, while the stablecoin sector has shrunk almost 8% to around a two-year low of $127 billion, according to researcher CCData.