CCData recently released the June 2023 Stablecoins & CBDCs Report on the status of major fiat stablecoins and central bank digital currencies (CBDCs).
The first fact that emerges in the Stablecoins & CBDCs report is the continued decline in the stablecoin market.
The total market capitalization of stablecoins fell 0.57% in June to $128 billion (as of June 19). This is the lowest stablecoin market cap since September 2021, after fifteen straight months of declines. However, at the same time, the dominance of stablecoins in the overall crypto market capitalization has risen to 11.8%, so the underlying problem is not related to stablecoins.
Nonetheless, the USDT (Tether) market capitalization hit a new all-time high, peaking at $83.5 billion in June. This was not enough to break the fifteen-month series of declines in the overall capitalization of all stablecoins, though, because USDT is among the few to rise. Also, USDT is rising slightly while other stablecoins are falling a lot.
In fact, USDT’s dominance in the stablecoin market increased from 64.3% in May to 64.6% in June. A more indicative piece of information, however, is that relating to trading volumes.
Trading Volumes
CCData reveals that trading volume in stablecoins fell to a yearly low, with a drop on May 10 to $414 billion. This is the lowest monthly trading volume for centralized stablecoins since December 2022.
Meanwhile, centralized exchanges saw trading activity grow in June, which evidently shifted from stablecoin to actual cryptocurrencies, as the dominance of fiat currencies has reached an all-time low in the crypto markets.
Fiat currency trading volumes are much higher than they were in the early days, but as a percentage, fewer and fewer people are using fiat currency to trade cryptocurrencies. The market shares of fiat currency trading pairs in crypto markets decreased to 18.8% in June, as compared to stablecoin trading pairs, also due to a 33.9% drop in trading volumes for fiat currency pairs, which fell to $99.7 billion.
CBDCs, Stablecoins, and Issues with Banks
According to CCData, the decrease in the trading volume of fiat currency pairs in the crypto markets is due in particular to the problems of the crypto exchanges with their banking partners, for which the banks themselves would have favored such drop in trading volume in the first place. Banks are also behind some problems that stablecoins have been facing for a few months.
Banks are not the only problem, and probably not even the main one, although it is curious that their work is hurting fiat currencies and stablecoins in the crypto markets, in favor of the real cryptocurrencies.
Although the report also covers the CDBC, it does not add further details. On CBDCs, it just says that developments around the world continued in June, with Japan and Thailand joining the list of countries that have launched pilot programs for their respective central bank digital currencies.
However, the Bank of Thailand itself has stated that as of today there is still no official plan for the launch of its own CBDC.
In addition, the report reveals that the team that facilitates digital interactions between government services, Symfoni Solutions, has announced the launch of a bridge, an ERC20 token pegged to NOK on Arbitrum, that will connect the Norwegian CBDC, with the Swedish one, as well as with the BROK government platform, which uses Blockchain technology to manage and share information about the shares of unlisted companies.
By Audy Castaneda
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