Total stablecoin market cap tops $200 billion as onchain lending yields surge

Reported by the Block: The total stablecoin market cap has reached a record high, surpassing $200 billion as onchain lending yields surge.

Stablecoin market cap growth could be driven by investors seeking exposure to onchain lending rates, which exceed those available in traditional finance, according to Coinbase analysts.

The total stablecoin market capitalization has reached a record high, surpassing $200 billion — reflecting a 13% increase over the past month — according to CoinGecko data. Similarly, The Block's total stablecoin supply metric, which includes unissued USDT held within the Tether treasury, has also exceeded the $200 billion mark. This surge comes as investors seek higher yield opportunities on decentralized finance platforms, according to analysts.

According to DeFiLlama data, the sharp increase in the stablecoin market cap began around Nov. 5, coinciding with Donald Trump’s victory in the U.S. presidential election. Coinbase analysts also highlighted that USDC deposit rates on Aave have doubled in the past month. "Stablecoin borrowing and lending rates have surged, reaching 10-20% annualized on Aave and Compound across nearly all of their deployed networks including Ethereum and Base," the analysts said. They also noted that the total value locked in lending protocols hit an all-time high of $54 billion, surpassing the previous bull market peak of $52 billion.
Coinbase analysts David Duong and David Han noted that the rise in stablecoin market cap signals investors are looking to capitalize on the increasing yields offered by DeFi lending protocols. "We think this represents a new influx of capital into the space looking to capitalize on elevated lending rates, more than three fold higher than long term bond yields, or searching for higher beta trades onchain,” the analysts said.

In addition to the rise in lending rates, Ethena’s yield-bearing token, sUSDe, has seen its annual percentage yield soar to over 24%, up sharply from around 13% in early November. However, DeFiLlama’s data predicts that sUSDe’s APY is likely to fall below 19% within the next month.

Coinbase analysts also pointed to emerging opportunities in higher-yielding assets, such as HyperLiquid’s HYPE token and newly launched AI agent protocols. They emphasized that these greater yields are only available to onchain participants, which is driving investors to engage with these decentralized platforms to capitalize on the potential opportunities.

“Continued strength in bitcoin and other crypto majors has driven significant onchain activity across various sectors, including decentralized exchange (DEX) volumes, borrowing and lending activity, and stablecoin growth,” the analysts noted.