The United States has seen record Bitcoin activity since the launch of spot BTC exchange-traded funds (ETFs). However, stablecoin adoption in the US has slowed in 2024 compared to global markets, according to an Oct. 17 report from Chainalysis.

US markets have recorded a significant shift in stablecoin activity this year, with the share of stablecoin transactions on US-regulated exchanges dropping from roughly 50% in 2023 to below 40% in 2024.

In contrast, the share of stablecoin transactions on non-US regulated platforms has surged since 2023, breaking 60% in 2024, according to Chainalysis’ latest report on crypto adoption trends in North America.

Share of stablecoin inflows to US-regulated and non-US-regulated exchanges. Source: Chainalysis

Chainalysis emphasized that the shift does not necessarily indicate a sharp decline in US stablecoin activity but instead reflects the rapidly expanding role of stablecoins in emerging markets and non-US jurisdictions.

Global demand for US dollar-backed assets has surged

One factor driving the shift in global stablecoin use is increasing worldwide demand for US dollar-backed assets, particularly in countries with limited access to stable currencies.

The report mentioned that more than $1 trillion in US dollar banknotes — or roughly half of total US dollar banknotes outstanding — were held outside of the US as of late 2022, according to official estimations by the US Federal Reserve.

Growth in stablecoin value received by US-regulated versus non-US-regulated exchanges. Source: Chainalysis

The growing use of stablecoins outside the US highlights a broader trend: global markets are increasingly turning to US dollar-backed stablecoins as a store of value and for cheaper transactions.

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Chainalysis’ findings echo insights from Tether CEO Paolo Ardoino, who told Cointelegraph in early October that the main demand for stablecoins comes from developing economies like Argentina, Turkey and Vietnam rather than the US.

Regulatory uncertainty threatens US leadership in stablecoin adoption

Regulatory uncertainty around stablecoins and digital assets is another factor contributing to the US falling behind other economies in stablecoin adoption.

According to Chainalysis, stablecoin firm Circle has noted that the lack of clear crypto regulations in the US has allowed financial hubs in Europe and the United Arab Emirates to attract stablecoin projects with more favorable regulatory environments.

Global crypto asset distribution as of June 2024. Source: Chainalysis

“The absence of a US regulatory framework for dollar-referenced stablecoins represents a threat to American interests,” a spokesperson from Circle warned in the report.

As more countries develop regulatory frameworks that encourage stablecoin adoption, US policymakers are under increasing pressure to act, Chainalysis said.

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