USDC’s supply drops by $9 billion in three months

The total supply of the stablecoin has dropped to $46,57 billion

06.10.2022 - 12:40

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What’s new? According to DeFiLlama, the total supply of the stablecoin USD Coin (USDC) from issuer Circle has dropped from $55,55 billion to $46,57 billion in the past 90 days. That means Circle has destroyed nearly 9 billion tokens since July, a record high for the company. Typically, it burns USDC when a user redeems a coin for the base fiat currency. To do this, the company sends the assets to a special address for burning.

DeFiLlama data

Cryptocurrency burning is the process of removing a certain number of tokens from circulation, after which they become permanently inaccessible. Often burning is carried out in order to increase the rate of an asset or prevent it from inflation. Burning can be done by sending tokens to a wallet without a private key, by conducting a hard fork, using special software, or using algorithms that destroy some of the funds during transactions

More about the situation. The spike in the burn coincided with a decline in USDC's yields on decentralized finance (DeFi) platforms. LoanScan data shows that the drop in the size of the USDC lending rate on Compound and Aave protocols has been about 80% since the beginning of the year.

Source: LoanSca

Meanwhile, the supply of the largest centralized stablecoin, Tether (USDT), by contrast, has increased by 2 billion tokens over the same period. As of October 6, USDT has a total market capitalization of $68б22 billion.

At the end of September, Circle announced the release of its stablecoin on five more blockchains: Arbitrum, Cosmos, NEAR, Optimism and Polkadot. The asset will appear on the Cosmos network in early 2023, while the other four networks will be available later this year. After the integration is complete, USDC will be available in a total of 13 ecosystems.

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