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Despite a $30 billion surge in stablecoin supply to new record levels, cryptocurrency investors remain cautious as they await market stability amid US tariff fears.
The total stablecoin supply rose by more than $30 billion in the first quarter of 2025, even as the overall crypto market capitalization fell 19%, according to a new report by crypto intelligence platform IntoTheBlock.
“The correlation between crypto and stocks climbed as macro expectations quickly shifted from “golden era” optimism to tariff-led doom and gloom,” according to IntoTheBlock’s quarterly report, shared with Cointelegraph.
Source: ITB Capital Markets
The stablecoin supply’s growth reflects a “cautious stance, with investors holding stablecoins as a hedge, likely waiting for market stability or better entry points,” according to Juan Pellicer, senior research analyst at IntoTheBlock crypto intelligence platform.
Related: Stablecoin rules needed in US before crypto tax reform, experts say
Industry leaders have predicted that the stablecoin supply may surpass $1 trillion in 2025, potentially acting as a significant crypto market catalyst.
“We’re in a stablecoin adoption upswell that’s likely to increase dramatically this year,” Pakman said during Cointelegraph’s Chainreaction live show on X on March 27. “We could go from $225 billion stablecoins to $1 trillion just this calendar year.”
The stablecoin supply surpassed the $219 billion record high on March 15. Analysts see the growing stablecoin supply as a signal for the continuation of the bull cycle.
Related: Stablecoins, tokenized assets gain as Trump tariffs loom
Stablecoin activity soars on Ethereum (
$2,299.42 )
During the first quarter of the year, the Ethereum ( $2,299.42 ) network saw over $3 trillion worth of stablecoin transactions on the mainnet, excluding layer-2 networks.
The number of unique addresses using stablecoins on Ethereum ( $2,299.42 ) mainnet also surpassed the record 200,000 mark for the first time in March.
Stablecoin daily active addresses on Ethereum ( $2,299.42 ) mainnet. Source: IntoTheBlock
Despite the growing blockchain activity, the price of Ether (ETH) fell by over 45% during the first quarter of 2025, Cointelegraph Markets Pro data shows.
ETH/USD, 1-year chart. Source: Cointelegraph Markets Pro data shows.
The decline in ETH is linked to a combination of broader macroeconomic concerns and Ethereum ( $2,299.42 ) -specific pressures, such as increased competition from networks like Solana and the rise of layer-2 protocols.
“Some analysts argue that layer-2 solutions dilute ETH’s value by shifting activity off the main chain, but this overlooks how L2s still rely on Ethereum ( $2,299.42 ) for security and pay fees, contributing to its ecosystem,” Pellicer said.
He added that the decline in ETH is more likely due to market sentiment and uncertainty about Ethereum ( $2,299.42 ) ’s ability to capture value from its broader ecosystem.
Still, other analysts see a silver lining to the tariff-related investor concerns. Nansen analysts predicted a 70% chance for crypto markets to bottom by June 2025 as tariff negotiations advance.
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