The growth of stablecoin market cap and changes in market share can affect the cryptocurrency market in the following ways:
- **Stability**: A growing market cap often signals increased investor confidence and can help reduce overall market volatility as investors use them as a hedge. Larger market share means more stable trading pairs, contributing to price stability.
- **Volatility**: However, if a stablecoin depegs or has issues, it can cause market panic and increase volatility. Also, a rapid change in market share among stablecoins may lead to short-term price fluctuations in the crypto market.