Recent data reportedly indicated that total Ethereum unfiltered on-chain transaction volume in August hit an all-time high of about $1.46 trillion. The data also highlighted that stablecoins transaction volumes have increased twice as much since the beginning of the year.
Ethereum Transaction Volume Records
Ethereum’s on-chain data indicated about $652 billion in stablecoin transaction volumes in January. Since then, the volumes have fluctuated, with the second-highest record in April, where transaction volumes hit $1.18 trillion. The stablecoin that recorded the highest volumes was MakerDAO’s DAI, which was $962.32 billion. The surge in DAI transaction volumes was allegedly caused by increased investor interest in decentralized finance. Tether’s USDT and Circle’s USDC followed with $265.84 billion and $209.98 billion, respectively.
Stablecoins' Role in DeFi
The Block’s Insights newsletter revealed that stablecoin’s increased usage could indicate a maturing ecosystem. According to The data, the increased transaction volumes could also indicate deeper liquidity pools, less slippage, and better market efficiency. For DeFi, stablecoin functionality and healthy markets are necessary for the coins’ power to fuel lending, yield farming, liquidity pools, and more. Therefore, a surge in transaction volumes and stablecoin usage could indicate healthier DeFi ecosystems.
PayPal PYUSD Growth
While PYUSD was not among the top 5 stablecoins that contributed to Ethereum’s high transaction volume, it has been recording significant growth since its launch. On-chain data showed that PYUSD’s volumes grew from $500 million to about $2.4 billion. PayPal has been making strategic partnerships with different companies to ensure the success of its stablecoin. In August, the company introduced a PYUSD reward program in partnership with Anchorage Digital. The reward system allows users to earn without lending, staking, or reusing assets.
The increasing transaction volumes for Ethereum and stablecoins indicate the strengthening and evolution of decentralized finance. Stability and innovation in the stablecoin sector continue to support and improve the DeFi ecosystem.
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