The short version
- Stablecoin supply fell to $301.6 billion on October 27, down $6.4 billion since October 7 and $14 billion below the $315.5 billion record of May 17.
- USDC did most of the damage, losing $4.15 billion in 30 days to $71.27 billion, including $0.78 billion of trading margin on Hyperliquid, so there is less cash on the sidelines to buy dips.
- The crew is watching whether supply breaks the August low of $298.3 billion, and whether Bitcoin holds $79,800 into the Fed decision on October 28 at 18:00 UTC (2:00 p.m. in Washington).
Stablecoin supply has fallen for most of October, and the money isn’t coming back yet. All dollar stablecoins together are worth $301.6 billion on DefiLlama, down from $307.9 billion on October 7 and $14 billion below the record of $315.5 billion set on May 17.
Most of the drop in the stablecoin market cap is one coin. USDC lost $4.15 billion in 30 days and is down to $71.27 billion. That is cash that used to sit on exchanges and in DeFi, ready to buy the dip. So what does a market with less of it look like?
The timing is awkward for Circle. Coinbase announced on October 8 that USDC will be the first stablecoin in Samsung Wallet:
Your Samsung Wallet is getting an upgrade.
USDC will be added to Samsung Wallet as the first supported stablecoin – powered by Coinbase.
Available soon in the US.
How Much Has Stablecoin Supply Fallen?
About $6.4 billion since October 7, and $14 billion, or 4.4%, since the May record. Supply has now slipped below where it started the year ($303.7 billion on January 1) and sits at its lowest level since August 23.
This is the second leg down this year. Supply fell from the May peak to $298.3 billion on August 11, then climbed back above $307 billion in early October as Bitcoin ran from about $63,000 in mid-August to $87,000. Now it is shrinking again while Bitcoin pulls back.
Tether is shrinking too, just more slowly. USDT is at $182.09 billion, down $1.7 billion in 30 days and $8.3 billion below its own peak of $190.43 billion on May 20.
Sponsored · Affiliate link
Save 20% on fees trading on WEEX
Base Camp may earn a commission if you sign up. It never affects what we write.
Where the USDC Went
Most of it left Ethereum. USDC on Ethereum fell $2.82 billion in 30 days, according to DefiLlama’s USDC chain breakdown, and USDT on Ethereum lost another $1.08 billion.
The second-biggest drop is the one traders should notice. USDC on Hyperliquid fell $0.78 billion to $6.77 billion. That is margin for perpetual futures, money that was there to open positions. Solana lost $0.59 billion of USDC as well.
The only real gain was on Arc, Circle’s own new chain, up $0.52 billion. That is USDC changing address, not new demand.
The small coins grew while the two giants shrank. That softens the total, but USDC and USDT are the coins that sit on exchanges and fund trades, so their drop matters most for prices.
SIDE TRAIL: Circle Stock Drops 6% After Mizuho Warns AI Agents Could Pull Cash From USDC
Why Fewer Stablecoins Means Less Dry Powder
Stablecoins are crypto’s dry powder, the cash on the sidelines. When a trader sells Bitcoin for USDC and keeps it on an exchange, that money can buy back in within seconds. When the USDC is redeemed for dollars at a bank, it has left the market.
That is what October shows. A coin only disappears from DefiLlama’s count when the issuer takes it back and pays out dollars, so a $4.15 billion fall in USDC means billions of dollars went back to bank accounts.
Less cash on the sidelines means fewer buyers waiting under the price. Dips get bought more slowly, and rallies need new money from outside crypto, such as ETF inflows, to get going.
Supply isn’t the whole picture, though. The same dollars can trade many times a day, and a big fund can bring new money in a single wire. The trend still matters: the September rally came while stablecoins were growing, and this pullback is happening while they shrink.
Bitcoin Price Analysis: Can BTC Hold $79,800 Without New Cash?
It is holding for now, but only just. The Bitcoin price is $79,925 on Binance at 03:40 UTC on Tuesday, down 2.3% in a week and 5.5% in 30 days. It sits right on the $79,800 support. Every daily close this month has been above $80,000, even with wicks down to $79,221 on Saturday, so today’s close matters.
The 50-day moving average at $81,866 has turned into a ceiling, and $81,479 is the first resistance below it. The 200-day moving average is far below at $73,064.
- Bullish: A daily close back above $81,479 and the 50-day average at $81,866 would put $84,898 back in play.
- Base case: A range between $79,800 and $81,479 into the Fed decision, with stablecoin supply still drifting lower.
- Bearish: A daily close below $79,800 opens $76,264, where Bitcoin bounced in early September.
What to Watch This Week
The Fed decides on rates on Wednesday, October 28, at 18:00 UTC (2:00 p.m. in Washington). Rates matter twice for stablecoins: they set what a bank account pays against a coin that pays nothing, and they move the appetite for risk.
- Total stablecoin supply: a fall below the August low of $298.3 billion would make this slide deeper than the summer one.
- USDC on Hyperliquid: more of it leaving means traders are closing shop for now.
- Samsung Wallet: Coinbase said USDC is “available soon in the US”. New users could slow the drain.
- Circle’s results on November 4: 13:00 UTC (8:00 a.m. in New York), the first chance to hear Circle explain October.
TRAIL MAP: On-Chain Metrics That Matter: MVRV, Realized Price and Exchange Flows
Bitcoin can rise without new stablecoins, but it is harder. Until supply turns back up, every bounce has to find its buyers somewhere else.
In crypto since 2016. Trades the macro picture and reads the market on the high timeframes.
More from TheCryptoMonk →
