USDC Trading Volume Hits $135 Billion

New regulations in Europe regarding digital assets and a jump in market inflows caused Circle's stablecoin trading volume to skyrocket in July.

USD Coin (USDC) trading volume climbed 48% in July, reaching $135 billion in part due to the Markets in Crypto-Assets (MiCA) regulatory framework and significant market inflows.

According to a July 31 report by CCData, the market value of USD Coin increased by 5.4% to $33.6 billion as of July 25. At the same time, the trading volume for USDC pairs on centralized exchanges reached $135 billion.

On July 1, regulators in the European Union certified Circle, the issuer of USDC, as the first stablecoin issuer under the MiCA regulatory framework. The framework aims to regulate digital assets and stablecoins within the EU.

Meanwhile, Tether (USDT) saw a slower growth rate but managed to expand its market value to $114 billion for eleven consecutive months. Tether's market value grew by 1.6% in July.

According to Cointelegraph, USDT continues to dominate the stablecoin market with a market share of roughly 70%, as reported by DefiLlama. On July 31, Tether also announced record-breaking first-half 2024 profits of $5.2 billion.

In July, the market capitalization of stablecoins reached $164 billion, marking a 2.1% increase from the previous month. However, trading volume on controlled exchanges fell for four consecutive months, decreasing by 8.4% to $795 billion as of July 25.

Several European cryptocurrency exchanges delisted stablecoins in the days leading up to the June 30th rule change, which saw significant stablecoin outflows from centralized exchanges.

EU Base Required for Stablecoins

The new rules require issuers of asset-referenced tokens (ARTs), such as stablecoins, and e-money tokens (EMTs) to be based in the European Union. They must also inform the relevant authorities and apply for approval by submitting a white paper.

For large stablecoins, stricter requirements may be imposed, including a daily transaction cap and a requirement that 60% of reserves be held in cash deposits across multiple banks.

Tether Exec on Banks: 'Very Few Accept This Type of Business' in Europe

"Very few banks accept this type of business in Europe. It’s already very difficult to get just one!" Paolo Ardoino, CEO of Tether, noted in an interview in May.