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USDC’s Circulating Supply Doubles in a Year—What’s Behind the Growth?
The total circulating supply of USDC has more than doubled in the past year, rising from approximately $4.3 billion to over $9.1 billion as of January 2025. This significant growth can be attributed to a combination of factors.
One key factor is the rise of decentralized finance (DeFi) applications and the increasing demand for stablecoins like USDC. As DeFi platforms continue to evolve, users require a reliable means of participating in financial activities, and stablecoins provide this security and stability. USDC’s role as an on-ramp to these platforms has become increasingly crucial.
Another critical factor is the growth of alternative layer-1 networks, which offer faster transaction speeds and lower fees compared to traditional blockchain networks like Ethereum. As a result, users are more likely to use USDC in conjunction with these platforms, further driving demand.
In addition, Coinbase’s decision to list USDC on its platform has also contributed to the coin’s growth. The move provided users with a trusted and secure means of accessing the DeFi ecosystem, ultimately boosting the supply.
Diversification Across Blockchain Networks
The distribution of USDC across various blockchain networks is another crucial aspect that has led to its significant growth. In 2023, more than 85% of the stablecoin was held on the Ethereum network. However, by January 2025, this concentration had decreased to approximately 65%, with the remaining supply spread across Solana, Base, Arbitrum, and Hyperliquid.
This diversification has allowed USDC to cater to a broader audience and adapt to the needs of different blockchain ecosystems, resulting in an increased total supply.
Conclusion
The doubling of USDC’s circulating supply over the past year can be attributed to a combination of factors. These include the rise of DeFi applications, the growth of alternative layer-1 networks, Coinbase’s listing decision, and diversification across blockchain networks.
Source: crypto-economy.com
