The stablecoin market reached a new all-time high in October, with total market capitalization growing 3.64% to $308 billion, marking the 25th consecutive month of expansion.
Stablecoin market dominance increased to 7.80% from 7.45% in September, driven by a decline in digital asset prices following the industry's largest liquidation cascade on October 10. On centralized exchanges, trading volume in stablecoin pairs reached $2.08 trillion (as of October 27).
Tether's USDT led the growth, with market capitalization rising 4.93% to $183 billion in its 26th consecutive monthly increase. USDT's market share grew for the first time in four months, reaching 59.4% from 58.7%. The stablecoin also maintained dominance in trading volume, accounting for 75.2% of total stablecoin activity on centralized exchanges.
Among the top 10 stablecoins, Sky Protocol's and PayPal's posted the largest gains. USDS rose 21.7% to $5.31 billion, while PYUSD increased 15.5% to $2.76 billion, reaching a new all-time high.
During the October 10 drawdown, Ethena's USDe briefly depegged to $0.65 on Binance. Ethena Labs clarified that the protocol's stability remained intact, attributing the incident to Binance's internal mark price system. On other exchanges, USDe showed greater stability, briefly falling to $0.92 on Bybit while remaining closely pegged on Curve and other decentralized exchanges.
Following the incident, USDe's market capitalization fell 30.3% to $10.1 billion, its lowest level since June and first monthly decline in four months. The drop also reflected compressed yields from falling bitcoin and ether perpetual funding rates, which recently turned negative on multiple occasions but have since recovered to the 2% to 4% range.
