The latest collaborative report by Dune and Artemis reveals a significant expansion in the stablecoin sector, with total supply reaching $214 billion as of February 2025.

Over the past year, stablecoins facilitated $35 trillion in transfers, surpassing the annual processing volumes of Visa ($15.7 trillion) and Mastercard ($9 trillion in Q4 alone).

Despite this impressive growth, the stablecoin market remains substantially smaller than traditional fiat liquidity, with the U.S. M1 money supply standing at $18.4 trillion and the Euro M1 supply at €10.6 trillion.

Institutional Adoption and Market Trends

The report highlights a surge in institutional adoption, as asset managers, payment providers, and financial institutions integrate stablecoins into their operations.

However, stablecoins still lag behind foreign exchange markets, where daily OTC forex transactions averaged $1.1 trillion in April 2024. This gap indicates significant room for expansion, particularly as regulatory frameworks evolve to support mainstream adoption.

Stablecoin Supply and Transfer Volume Growth

Between February 2024 and February 2025, the total stablecoin supply increased by 63%, from $138 billion to $225 billion. Transfer volumes more than doubled, rising from $1.9 trillion per month in February 2024 to $4.1 trillion in February 2025, with a peak of $5.1 trillion in December 2024.

User Adoption and Transaction Size

Active addresses increased by 53% year-over-year, reaching 30 million by February 2025. Despite the rise in transaction volume, the average transfer size remained stable at approximately $683,000, with notable spikes in May ($2.6 million) and July ($2.2 million), indicating periods of heightened institutional activity.

Collateral Composition: Fiat-Backed Stablecoins Dominate

The report notes that 91% of stablecoins are backed by cash reserves or short-term government securities, reflecting a growing preference for fully collateralized models.

Overcollateralized crypto-backed stablecoins accounted for 8.5% of the market, while algorithmic stablecoins continued to decline due to reduced confidence in their stability.

USDT and USDC: Market Leaders Face Shifting Dynamics

USDT remains the largest stablecoin by supply, increasing from $96 billion to $146 billion, though its market share declined from 69% to 64%.

USDC, on the other hand, doubled in supply from $28.5 billion to $56 billion, gaining market share to reach 24.5%. USDC's growth has been driven by increased regulatory clarity, including its recognition under the EU's Markets in Crypto Assets (MiCA) framework and adoption by major financial hubs like Dubai and Canada.

Emerging Stablecoins: USDe, USDS, and PYUSD Gain Traction

Ethena’s USDe saw explosive growth, rising from $620 million to $6.2 billion, making it the third-largest stablecoin.

MakerDAO’s rebranded ecosystem, Sky, introduced USDS, which quickly amassed $2.6 billion in supply.

Also, PayPal’s PYUSD expanded significantly, particularly on Solana, where its adoption surged by 271% following a strategic expansion.

Blockchain Distribution: Base and Solana Gain Market Share

Ethereum and TRON continue to dominate stablecoin supply, but TRON’s share fell from 35% to 28%, while Solana saw rapid growth from 1.6% to 5.4%.

Base emerged as a leader in transfer volume, growing from $3.7 billion in February 2024 to $1.9 trillion (43% market share) by February 2025.

TRON remains dominant for peer-to-peer (P2P) transactions, particularly in emerging markets.

The Future of Stablecoins: Institutional Integration and Yield Opportunities

The report underscores the evolving role of stablecoins in global finance, with increasing adoption in decentralized finance (DeFi), cross-border payments, and real-world asset tokenization.

As regulatory clarity improves and financial institutions embrace digital assets, stablecoins are poised for further growth, potentially bridging the gap between traditional finance and the crypto economy.