The Transition of the Stablecoin Market from Issuance to Distribution

Stablecoins have become an indispensable financial tool in the cryptocurrency space, with a total supply exceeding $240 billion and an annual on-chain transaction volume exceeding $7 trillion. However, as the market matures, the value of stablecoins is shifting from issuance to distributors.

New Phase of the Stablecoin Market

The current stablecoin has entered a new stage of development, and relying solely on issuance and liquidity is insufficient to bring about sustained growth. The future growth of stablecoins will depend more on:

• Share economic benefits with partners
• The convenience of on-chain and off-chain integration
• Utilization degree of programmable features

Value Transfer from Issuance to Distribution

The value of early stablecoins was mainly concentrated on the issuer, primarily monetized through reserve income. But now the importance is shifting towards distributors:

• Distributors control user relationships and experiences
• Decide which stablecoins can gain attention
• Charge the issuer integration and promotion fees

For example, Circle paid nearly $900 million to partners like Coinbase in 2023 for the integration and promotion of USDC, exceeding half of its total revenue for the year.

On-chain stablecoin main use cases

Currently, on-chain stablecoins are mainly concentrated in three environments:

1. Centralized Exchange ( CEX ): Accounts for 27% of total supply, 11% of total trading volume.
2. DeFi Protocols: Account for 11% of total supply, 21% of total trading volume
3. MEV: accounting for less than 1% of total supply, 31% of total trading volume.

Among them, the usage of DeFi has grown the fastest, with monthly trading volume increasing from $100 billion to $600 billion over the past 6 months.

The Importance of Unattributed Wallets

The unallocated wallets account for 54% of the total stablecoin supply and 35% of the total trading volume, including:

• Retail users
• Unknown institution
• Startups and small to medium enterprises
• Dormant or passive holders

This part of the "gray area" wallets accounts for an increasing share in real-world payments, savings, and other fields, and is an important direction for future growth.

Conclusion

The stablecoin ecosystem is entering a new stage, with more value flowing towards the builders of applications and infrastructure. The future financial world will be defined by the entire ecosystem formed around stablecoins, not just the stablecoins themselves.