Stablecoin market loses $10 billion since May in biggest decline since 2022
The total stablecoin market capitalization has fallen by roughly $10 billion since May, marking the largest dollar-denominated decline since the collapse of the Terra-Luna ecosystem in 2022. Despite the pullback, analysts say the correction appears temporary and do not expect a repeat of the last crypto winter.
According to CoinDesk Data, the stablecoin market shrank by $7.7 billion in June 2026. Since reaching its peak in May, the total stablecoin supply has declined by about 3%, analysts said.
Change in stablecoin market capitalization. Source: CoinDesk Data.
The decline was driven primarily by the two largest issuers. Tether's USDT market capitalization fell from around $190 billion to $184 billion, while Circle's USDC dropped from nearly $80 billion to $73 billion.
Analysts do not expect another crypto winter
Analysts say the current contraction differs significantly from the market downturn of 2022–2023. Following the collapse of TerraUSD, FTX, and several major crypto lenders, the combined market capitalization of leading stablecoins declined by more than 26%.Paul Howard, Senior Director at trading firm Wincent, described the latest decline as a modest correction within a broader long-term uptrend.
According to Howard, short-term fluctuations in liquidity are a normal part of the market cycle. They do not alter the long-term outlook for stablecoins, whose role continues to expand across both cryptocurrency trading and payment applications.
Competition among issuers intensifies
Analysts also attribute the slowdown to intensifying competition among stablecoin issuers. While the supply of USDT and USDC has declined, newer projects continue to expand rapidly.For example, Global Dollar (USDG), issued by Paxos and backed by a consortium that includes Robinhood, has surpassed $3.2 billion in market capitalization. Meanwhile, the supply of USDGO, issued by Anchorage Digital and Hong Kong's OSL Group, has nearly doubled to almost $900 million.
Several new entrants are also preparing to launch, including OpenUSD, which is backed by companies from the financial and payments industries.
In June, Coinbase announced that it had joined the Open Standard consortium developing the stablecoin. The initiative is supported by more than 100 companies, including Visa, Stripe, BlackRock, and Chime. Participants aim to build a regulated stablecoin infrastructure capable of competing with USDT and USDC.
Earlier, Binance reported that stablecoin reserves on its platform had reached a record $53 billion. According to the exchange, it now holds about 57% of all stablecoin reserves on centralized cryptocurrency trading platforms.
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