Matrixport: The liquidity of stablecoins is shrinking, and the short-term purchasing power of the crypto market is also weakened

Matrixport released a chart today stating that the "GENIUS Act" is expected to prohibit stablecoin issuers from paying interest or yields to holders. Funds may therefore shift towards yield-generating alternatives like tokenized money market funds. USDC has seen net redemptions of about $6.5 billion over the past six weeks, leading to a contraction in stablecoin liquidity and a weakening of short-term purchasing power in the crypto market.

Meanwhile, funds are flowing out of stablecoins and into traditional safe-haven assets like gold and silver, further shrinking the supply of stablecoins. Accordingly, Circle is shifting its focus from "market capitalization" to "trading activity," promoting the use and payment of stablecoins in real-world scenarios through initiatives like the Circle Payment Network and partnerships with companies like Intuit.