Stablecoin markets have hit a record level, surpassing the $204 billion mark, according to data from CoinGecko. This 13% growth over the past month is linked to higher yields in on-chain lending, currently outperforming traditional financial metrics. This is evidenced by the rise in total value locked (TVL) in decentralized lending protocols to $54 billion.
According to analysts David Duong and David Han from Coinbase, the growth in stablecoin market cap reflects investor activity on DeFi platforms. They noted that the yields from lending in on-chain protocols like Aave and Compound are currently at 10–20% annually, which is three times the profitability of long-term bonds.
The sharp increase in the stablecoin market coincided with Donald Trump’s victory in the US presidential election on November 5. Notably, the deposit rates for USDC on the Aave platform doubled over the month, and Ethena sUSDe (Ethena Staked USDe) shows a yield of 27% per annum, although it is expected to decrease to 19% in January 2025.
Interestingly, last week the stablecoin Ethena USDe surpassed DAI and became the third largest in terms of supply. In just two months, its growth amounted to $3 billion, exceeding:
- Total value of ETH ETFs: $1.9 billion.
- Total value of BTC ETFs (excluding iShares Bitcoin Trust (IBIT)): $1.3 billion.
Coinbase experts pointed to new opportunities for investors, particularly higher-yielding assets like the HyperLiquid (HYPE) token and AI protocols. High profitability rates are only available to on-chain participants, stimulating increased activity on DeFi platforms.
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