@dmredacted

Stablecoin supply has been stuck at the $310 billion mark since October. While this may look like market stagnation on the surface, the underlying mechanics suggest it’s just a temporary reallocation. The main competitor for liquidity right now is the US Treasury. High Treasury yields create a massive opportunity cost – capital is staying off-chain to capture risk-free returns rather than sitting idle in stablecoins. Regulatory clarity is the other bottleneck. Investors are frozen between the US GENIUS Act and the EU’s MiCA framework. Big capital is hesitant to deploy at scale until the rules of the game are defined. The liquidity hasn't left the ecosystem – it is simply parked in traditional instruments, waiting for the regulatory fog to clear.

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