The Surge in Stablecoin Activity
Stablecoins have gained popularity among investors, despite concerns about their impact on the financial market. According to a recent report from QuickNode, stablecoins have seen a significant increase in activity across blockchain networks. Between the first and third quarters, there was a 45% growth in active addresses and a 41% increase in transactions for stablecoins.
In contrast, decentralized finance (DeFi) experienced a decline in daily active addresses and transactions during the same period. The number of daily average transactions for DeFi dropped from over 1 million in the first quarter to 786,000 in the third quarter.
Stablecoin’s Appeal to Investors
Stablecoins solidified their dominance in the market in July, surpassing DeFi protocols in terms of transactions on various blockchain networks. In the third quarter of 2023, stablecoins had over 400,000 daily active addresses, making them the only category to experience growth.
“The rise can be attributed to the inherent stability and value predictability that stablecoins offer, making them an attractive entry point for both new and seasoned users.”
USDT remains the leading stablecoin in terms of market capitalization, active addresses, and transaction activity. It had an average of 337,000 daily active addresses and 680,000 daily transactions in Q3.
However, USDC has been closing the gap with USDT since Q1. The slight de-pegging of USDC by about $0.03 and the collapse of Silicon Valley Bank contributed to a decrease in volume for USDC.
Uniswap’s Success
Among decentralized exchanges (DEXs), Uniswap has remained stable since Q1 2023, even after the collapse of Silicon Valley Bank. Uniswap experienced a 15% growth in active addresses and a 33% increase in transaction count during Q3, diverging from the broader trend in DeFi.
While DEXs continue to dominate the DeFi subcategory, staking is also gaining momentum. The total staked Ether increased from 23.7 million to 27.2 million in Q3, with 37% of this attributed to Liquid Staking.
Lido DAO’s protocol, which allows users to stake Ether and receive stETH tokens, saw its value grow from $7.6 billion to $8.8 billion in Q3, marking a 16% increase.
Hot Take: Stablecoins Thrive Despite Market Conditions
Despite concerns about their impact on the financial market, stablecoins have proven to be a popular choice among investors. Their stability and predictable value make them an attractive option for both new and experienced users. As seen in the surge of activity across blockchain networks, stablecoins have outperformed other categories like DeFi. This dominance is likely to continue as stablecoins solidify their position as the go-to asset for investors.
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