In a marked display of market dynamism, the cumulative supply of Tether’s USDT and Circle’s USDC, the two dominant stablecoins, experienced a remarkable expansion, swelling by nearly $3 billion within a single week. This surge, prompted by a recent market downturn, indicates a fervent rush among investors to capitalize on lower cryptocurrency prices.

Tether’s maneuver was particularly notable, with the firm transferring an immense $1.3 billion worth of USDT to exchanges and market makers since the previous Monday, as observed by on-chain analyst Lookonchain. Consequently, USDT’s market capitalization ascended beyond $115 billion, establishing a new historical pinnacle.

Read more: Solana’s PYUSD Stablecoin Closing Supply Gap with Ethereum’s PYUSD

Simultaneously, USDC, the second-largest stablecoin by market cap, witnessed a substantial increase, adding approximately $1.6 billion this week, culminating in a total market value of $34.5 billion—the highest since March 2023, according to TradingView data. David Shuttleworth, a research partner at Anagram, highlighted that the lion’s share of this expansion occurred on the Ethereum network, which absorbed $1.36 billion, while Solana’s network registered $356 million in inflows.

This expansion reflects a broader investor movement as market participants transferred capital to exchanges in the wake of the sell-off. Binance, the world’s leading cryptocurrency exchange, observed a significant influx, receiving over $1.5 billion in USDT deposits and $820 million in USDC deposits within just four days post-Monday’s market crash, as reported by DefiLlama.

FalconX, a prominent digital asset brokerage, also identified heightened buying activity, noting that virtually all investor categories, including hedge funds, venture funds, and retail aggregators, were “net buyers” during this period.

Stablecoins, serving as tokenized representations of fiat currency, play a pivotal role in bridging traditional finance with the blockchain-based economy, providing essential liquidity for trading and lending operations. The expansion in stablecoin supply typically signals robust market health, indicating a renewed influx of capital and investor confidence.

The total market capitalization of stablecoins experienced a meteoric rise from November to March, coinciding with a rally in cryptocurrency prices and Bitcoin reaching a new all-time high above $72,000. However, the growth plateaued for several months as the broader crypto market cooled. Recent developments, however, suggest a resurgence in stablecoin demand, reflecting renewed optimism and engagement within the crypto ecosystem.

In an interview with Bloomberg, Tether’s CEO Paolo Ardoino disclosed the company’s ambitious plans to double its workforce to 200 by mid-2025, with significant investments in expanding its compliance and operational teams. This move underscores Tether’s commitment to fortifying its market position and supporting the burgeoning demand for its stablecoin offerings.