Circle’s stablecoin report mentions the growth of USDC in Asia and Latin America

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USD Coin (USDC) stablecoin issuer Circle Internet Financial recently released an extensive report on the current state and future outlook of its flagship product.

According to the report, USDC's market capitalization has risen to nearly $1 billion in recent months, showing rapid growth in usage and market share compared to previous years. Entitled “The State of the USDC Economy,” the report examines and analyzes USDDC-related technologies and provides insights into global markets and related regulatory developments.

USDC's market share has taken a hit over the past year, with its market capitalization falling nearly 60% to $24 billion by November 2022. In contrast, the report shows significant growth in the volume of USDC trading flowing into the Asia-Pacific region.

According to the statistics of the report, by 2022 USD 130 billion will flow into Asia. This number represents 29% of the total global digital currency value received. .

A significant driver of these Asia-Pacific USDC transactions is remittances to emerging market countries with large diasporas such as the Philippines. Circle says this market is worth $36 billion a year. Asian economies such as India, Singapore, Hong Kong, Malaysia, and Thailand have established 24/7/365 real-time payment systems, achieving high volumes and volumes.

In particular, Singapore, Japan and Hong Kong have recently taken steps to implement regulatory frameworks for foreign-issued stablecoins, including the USDC.

The Monetary Authority of Singapore has issued a circuit with a major payment institution license to enable USDC and other dollar-based stablecoins. The country has begun researching a government-backed stablecoin based on the Singapore dollar.

Japan has implemented new stablecoin guidelines allowing partnerships pending the distribution of USDC in June 2023. On this front, Circle said it is partnering with SBI Holdings (Strategic Business Innovator Group) to expand its presence in the country.

Meanwhile, Hong Kong In early 2023, it completed initial consultations on the regulation of stablecoins, with arrangements to be completed in 2024.

Latin America was also prominent in the report, with Circle saying it is leading the way in digital currency adoption, primarily due to high transaction volumes. The report cited macroeconomic instability in the region, which has resulted in demand for the US dollar.

According to Circle research, nearly a quarter of its 658 million residents are under the age of 14, positioning Latin America for the fastest fintech growth compared to aging regions. According to the report, more than 51% of Latin American users have traded in digital currencies, while 33% are in stable coins.

According to Ledger Insights' criticism, the 2023 Circle stablecoin report omitted key statistics such as the percentage of transactions in 2023 USDC transaction volumes and the decline in wallet fees. The report also did not mention the USDC de-peg caused by the collapse of Silicon Valley Bank, although some of the sable criticisms of the de-peg are unfair in light of the situation.

A circle held 20% of its reserves in cash, rather than the commonly assumed 90%, and it made sense for a large stablecoin to hold large reserves in advance of a major bank collapse.

A key aspect of Statcoin's technology is enabling the transfer of value between traditional banks and new financial systems. According to the report, Circle bridged more than $197 billion between these systems last year. Since USDC was released, more than $12 trillion has been transferred, and the number of wallets holding more than $10 in USDC has increased by 59 percent to 2.7 million, according to the report.

These trends show that stablecoins as markets are no longer used primarily for speculative activity, but instead form a secure infrastructure for digital value transfers. On January 11, 2024, Club privately filed for an IPO.

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