Stablecoin report: $10B outflow, tokenized Treasuries rise

Stablecoin market capitalization declined by about $10 billion from May to roughly $310 billion, while adjusted stablecoin transaction volume rose 63% to $1.79 trillion in June. Market participants said the shift reflected a move of idle balances into tokenized Treasury products following regulatory limits on paying interest on payment stablecoins.

Tokenized Treasury assets under management increased from about $11 billion to $16 billion over five months. Circle’s USYC became the largest fund in the tokenized Treasury segment, surpassing BlackRock’s BUIDL. BUIDL reported roughly $2.9 billion across Ethereum, Avalanche and Solana after a large inflow into its Avalanche pool in July. A competing JPMorgan product grew 87% in one month.

Outflows were uneven across issuers. Tether’s market cap fell by about $5.4 billion over 60 days. Sky Dollar registered the steepest weekly percentage decline among the top 15 issuers. Revolut’s announcement to delist USDT is estimated to have prompted about $2 billion in monthly outflows ahead of its August 31 deadline.

Infrastructure and clearing firms reported funding and new product launches. Visa introduced the Visa Stablecoin Platform to support minting, redemption, custody and transfers through a single interface and disclosed it processed $3.7 billion in stablecoin-linked card volume over the trailing 12 months across 1.9 million active cards in more than 200 markets. Augustus raised $180 million at a $1 billion valuation to build 24/7 programmable settlement rails. London-based Velocity raised $38 million to expand treasury and settlement services. Cyclops secured $20 million and Cordant $8 million for payments and banking-focused infrastructure.

A smart-contract failure led to a sharp token loss. Wemade’s WEMIX$ token fell from $1 to $0.0008 after a breach allowed unauthorized minting of about $5.2 million tokens. Attestations of reserves did not detect the error; the malfunction occurred in the token’s mint function.

Regulatory rulemaking continued. The GENIUS Act’s ban on paying interest on payment stablecoins is one year old and federal guidance remains pending. The Treasury opened a comment period on proposed rules for state-level stablecoin regimes and the Office of the Comptroller of the Currency published proposed application and information requirements for payment stablecoin issuers; the comment window for both processes closes September 25. California repealed its state-level stablecoin licensing provisions and deferred to the incoming federal framework. Goldman Sachs CEO David Solomon publicly backed the Digital Asset Market Clarity Act, while several banking trade associations warned interest-like yields on stablecoins “will siphon commercial bank deposits.” Senate Majority Leader John Thune confirmed no market-structure vote would occur before the August recess.

Other developments included a won-backed stablecoin announced by Coupang and Woori Bank for merchant payouts in South Korea and regulatory consolidation there into a Digital Asset Basic Act. Tether launched a GENIUS-compliant USAT token on Celo. Vanuatu appointed its first Commissioner of Stablecoins. The Banque de France reiterated interest in a digital euro. In a BIS-backed test, Project Agorá saw 28 global banks settle transactions across six currencies in an average of about 80 seconds. Samsung demonstrated USDC send-and-receive in Samsung Wallet and Circle acquired more than 680 patent families from IBM’s blockchain portfolio.

On-chain stablecoin supply declined while transaction throughput increased. Capital moved into regulated, yield-bearing tokenized Treasury and money-market products, while payments and settlement activity concentrated on established stablecoins and emerging settlement rails.