In the year Wallets with USDC stablecoins have grown by 59% in 2023, despite declining circulation.

The number of wallets holding at least $10 worth of US dollars (USDC) will grow by 59 percent by 2023, according to a Jan. 15 report from Issuer Circle. This growth comes despite the USDC losing $20 billion in circulating supply, indicating that the coin could find users as its market capitalization declines.

The report, titled “The State of the USDC Economy,” provides a broad overview of the current use of the USDC. In the report, Circle said the coin's circulating supply fell from $45 billion to $25 billion in the first 11 months of 2023, a roughly 44 percent decline.

Declining circle in “[r]Interest rates, regulatory loopholes, bankruptcies and outright fraud” in crypto have led users to withdraw their funds from the ecosystem and into traditional markets. He cited the “opportunity costs of holding USDC” as a particularly important force behind this decline, as rising interest rates drew investors back to traditional markets.

Related: Fed rate cuts for DeFi and stablecoins – Loyalty

But amid this turmoil, other signs show growing acceptance of the USDC, the report said. More than $197 billion USD was raised or burned during the year, allowing the coin to act as “a major bridge between the digital asset economy and traditional finance.” Additionally, the number of wallets with USDC worth more than $10 has grown to over 2.7 million, a 59% increase by 2022.

In the year 2023 was a tumultuous year for the USDC. In March, it briefly lost its grip during the brief but turbulent banking crisis in the United States. However, the peg quickly returned after the Federal Reserve moved to pay off several failing deposits.

In the year In the first two weeks of 2024, Circle has launched an initial public offering in partnership with Yellow Card to raise funds for the further development of the USDC ecosystem and expand the use of USDC in Africa.