Stablecoin Supply Stalls as Payment Volume Jumps 45%, Signaling Broader Real-World Use

Stablecoin issuance has largely stalled this year, even as use in real-world payments has expanded rapidly.

CoinDesk reported on November 9, citing data from blockchain analytics firm Allium, that stablecoin circulation rose just 0.4% to $305 billion from January through September. Over the same period, stablecoin payment volume climbed 45% to $482 billion, while the number of payment transactions increased 71% to 1.04 billion.

The average stablecoin payment size fell to $462 from $544. That suggests smaller transactions became more common even as overall payment volume increased. In particular, September payment volume hit a record monthly high of $72 billion.

Circle, the issuer of USDC, showed a similar pattern. USDC circulation stood at $73.9 billion at the end of the third quarter, unchanged from a year earlier, while on-chain transaction volume rose 49% to $13.9 trillion. Circle Chief Executive Officer Jeremy Allaire said balances were flat but usage continued to grow. Still, on-chain transaction volume includes crypto trading and fund transfers in addition to actual payments.

Experts pointed to rising capital turnover as the reason growth in stablecoin circulation lagged growth in payments. Tianwei Liu, chief executive officer of Singapore-based stablecoin issuer StraitsX, said the same pool of liquidity can be used for multiple payments, meaning issuance does not need to increase at the same pace. Standard Chartered data showed average monthly stablecoin turnover doubled to about 30 times this year from 15 times last year.

Payments by artificial intelligence agents are also emerging as a new use case. According to Allium, AI agent payment transactions doubled from the previous quarter to 68.3 million in the third quarter. But total payment volume was just $3.7 million, leaving the average transaction value at about 5 cents. Experts expect AI payments to help lift transaction counts, though their effect on expanding stablecoin supply is likely to remain limited.

Meanwhile, a key reason for stagnant stablecoin supply was a decline in demand for crypto trading. Trading volumes have fallen by more than 50%, reducing the amount of stablecoin liquidity needed on exchanges and in derivatives markets. Geoff Kendrick, Standard Chartered's head of digital assets research, said the recent supply stagnation was a cyclical effect tied to a market downturn rather than a structural shift.

Even so, growth in actual payments has not fully offset weaker trading demand. Allium said real payment volume accounted for only about 0.5% of the $97.9 trillion in total stablecoin on-chain transfer volume from January through September. Experts said assessments of growth in the stablecoin market should distinguish actual payment usage from issuance totals and overall on-chain transaction volume.