As Base embraces USDC, will it cause a stir in stablecoin markets
- Native USDC is set to be deployed on Base in the coming week.
- USDC remains behind USDT in market capitalization.
A significant milestone was on the horizon for Base, as the CEO of Circle has recently made a crucial announcement. This new development raises questions about the potential effects on the stablecoin market cap and its total value locked (TVL).
Native USDC on Base
Base is set to see USDC become native to the platform, according to recent posts by Circle, the issuer of USDC, and Jeremy Allaire, CEO of Circle. This transition is scheduled for the upcoming week, as stated by Allaire, although a specific date has not been provided.
— Jeremy Allaire (@jerallaire) August 29, 2023
Furthermore, the bridged version of the stablecoin is currently being utilized. However, Circle’s official blog post has clarified that this bridged version will gradually be phased out upon the launch of the native USDC version. This strategic shift is expected to enhance the liquidity of the stablecoin on the Base platform.
This strategic move aligns with Circle’s recent announcement regarding the expansion of USDC to additional blockchain networks. Furthermore, considering Coinbase’s increased ownership stake in Circle, integrating native USDC into Base appears to be a logical progression due to the existing partnership.
What is, however, the state of stablecoins on Base currently?
The Base stablecoin market cap
Since its inception, Base has experienced consistent growth in its stablecoin market capitalization, as evidenced by data from DefiLlama. Following a surge that pushed it past $53 million on 16 August, the market cap chart has displayed a steady upward trajectory.
As of this writing, the stablecoin market capitalization had surpassed $63 million. Simultaneously, the Total Value Locked (TVL) on the platform has also gradually increased, according to the data.The TVL has approached the $198 million mark at press time.
While the precise portion of the stablecoin market capitalization attributable to USDC on the Base platform was not explicitly specified, the recent development holds promise for potential growth in USDC’s presence. However, the exact extent of impact that this development might exert remains uncertain.
How the multichain strategy could work for USDC
As of this writing, USDC maintains its position as the second-largest stablecoin, trailing behind Tether’s USDT. According to data from CoinMarketCap, the market capitalization for USDC was over $26 billion. In contrast, USDT had a market capitalization of over $82 billion.
Given the strategy to expand across multiple blockchain networks and the impending integration onto the Base platform, USDC has the potential to witness a growth in its market share within the stablecoin market. This strategic move can contribute to an increased prominence and adoption of USDC within the broader ecosystem.