Stablecoin Duopoly: Tether and Circle Dominate Market
The stablecoin market has become increasingly concentrated, with Tether's USDT and Circle's USDC controlling nearly 85% of the total supply. According to recent data, these two assets combined have a circulating supply of approximately $257.7 billion out of a total market capitalization of around $302.9 billion.
USDT remains the largest stablecoin by far, with a supply of around $183.4 billion and a 60.5% share of the market. USDC trails behind at around $74.3 billion, representing 24.5% of the total supply. This concentration is reflected in the Herfindahl-Hirschman Index, which measures market concentration using a scale where anything above 2500 is considered 'highly concentrated.' The stablecoin market's HHI sits at approximately 4244.
This dominance has led some to question the potential risks of a disruption to either Tether or Circle. With such a large portion of the market controlled by these two entities, any issues could have significant implications for traditional money markets and crypto as a whole.