TechFlow news — On October 22, Bitwise, a crypto asset management firm, released its Q3 2024 Crypto Market Report, highlighting that stablecoins are emerging as a critical application of blockchain technology and are increasingly penetrating multiple multi-trillion-dollar markets. The report notes that while cryptocurrency prices have remained relatively flat over the past six months, significant foundational progress has been made within the industry.
According to Bitwise data, global stablecoin transaction volume reached $5.1 trillion in the first half of 2024, approaching Visa's $6.5 trillion transaction volume. Currently, the top five stablecoins collectively hold more U.S. Treasury securities than some G20 countries, including South Korea and Germany.
Stablecoin issuers primarily generate revenue by holding interest-bearing assets such as U.S. Treasuries. This business model has significantly boosted profitability for companies like Tether, whose profits last year surpassed those of asset management giant BlackRock.
With traditional payment giants like PayPal entering the stablecoin space, Bitwise suggests stablecoins could become a viable alternative to the $6.3 trillion money market fund industry. The report emphasizes that if stablecoin issuers pass on a portion of their Treasury yields as interest to holders, stablecoins could become a powerful tool within investment portfolios.
