USDC Ecosystem Outlook Report 2025

Executive Summary

In the past year, USDC has made significant progress in economic growth and application maturity. Globally, as more individuals and businesses experience the power of digital dollars on blockchain networks, this trend shows strong momentum. Developers are continually discovering new ways to build application platforms using USDC and Circle technology, making global commerce and finance more efficient, faster, and inclusive.

2024 USDC specific data:

• The total annual circulation of USDC increased by over 78% year-on-year, outpacing any other major stablecoin.
• In November, the monthly trading volume reached 1 trillion USD, with a historical cumulative trading volume exceeding 18 trillion USD.
• Through partnerships with leading exchanges, banks, and wallets, USDC is now available to over 500 million end users.

In addition to the status of the US dollar in trade, payments, and global finance, three factors are expected to accelerate the adoption of USDC:

1. Legal Regulatory Clarity: New stablecoin rules are establishing robust compliance standards.
2. Blockchain network scalability: Infrastructure is rapidly improving, becoming faster, more secure, and more flexible.
3. Excellent User Experience: The number of connections between USDC and traditional finance has surged.

Based on these factors, along with the open network of the value internet and ultra-high throughput, the Circle stablecoin network is capable of achieving near-instantaneous global value distribution.

About Circle and USDC

Circle stablecoin network

Global interest in USDC is growing from the ground up, with more and more businesses and individuals recognizing that stablecoins and blockchain networks can address the long-standing issues of global payments. These problems mainly stem from the outdated payment rails that today's commercial activities rely on.

Circle collaborates with leading global banks, payment service providers, and other institutions to connect all participants in a comprehensive, internet-based settlement system with USDC at its core, through a stablecoin network. USDC enables the innovation of blockchain networks to bridge and strengthen the global banking financial system. Since its launch in 2018, Circle has achieved over $850 billion in two-way flows between fiat currencies and supported blockchains.

USDC is both a currency and a platform.

USDC is a digital dollar that can be transferred across multiple blockchain networks, offering significant advantages in terms of cost, speed, and coverage compared to traditional forms of currency. USDC embodies the three fundamental functions of currency: a digital store of value, a unit of account, and a medium of exchange.

As a bridge between traditional finance and blockchain, USDC needs to integrate closely with the banking system. Circle collaborates with leading banks, including several globally systemically important banks, to ensure USDC can be exchanged for USD at a 1:1 ratio. These partner banks are strategically distributed around the world, making USDC cost-effective and easily accessible in high-demand markets.

The strength of USDC lies in the fact that it is both a digital dollar and a platform. This platform is eliminating the technical barriers to transferring funds and building new applications on the blockchain, paving the way for mass adoption.

Circle's compliance principles for managing USDC

The basic principles of Circle managing USDC:

1. Security: USDC is a tokenized dollar, not a tokenized bank deposit.
2. Transparency: Full disclosure of reserve assets, guaranteed by a third party.
3. Liquidity: Can be exchanged for USD at a 1:1 ratio worldwide at any time.
4. Stability: Comprehensive risk management and world-class financial partners

Circle is the sole issuer of USDC. USDC is fully backed at all times by cash and cash equivalents held in a regulated financial system, approximately 90% of which are short-term U.S. Treasury bills and overnight repurchase agreements, with the remaining 10% in cash. Circle discloses reserve assets, minting, and redemption information on its official website weekly. A reserve report is released monthly, audited by Deloitte.

US Dollars on the Internet

Internet speed of value transfer

USDC is built on an open blockchain network, allowing currency, payments, lending, and other programmable features to be directly integrated into the internet architecture. As of 2024, USDC natively supports 16 blockchains, including Ethereum and many "third-generation" blockchains designed for near-instant, free payment settlements.

USDC user group gradually expanding

Since the beginning of 2023, the number of wallets holding at least 10 USD USDC has nearly doubled, reaching 3.9 million addresses. Circle has established partnerships with many companies, which can now distribute USDC to millions of their own users.

Global companies' interest in Circle has surged.

From financial institutions and enterprise technology companies to innovative payment companies, there is a growing commercial interest in Circle. USDC is borderless, always online, and capable of near-instant payments, driving the next wave of global commerce.

Brand New Internet Financial System - Value Internet

The growth of the USDC user base is rising in sync with the emergence of a new financial system on the internet, creating new ways of value exchange and enhancing and expanding the activities of the traditional financial system. As time goes on, it is expected that more traditional financial activities will migrate to this new internet financial system based on open internet protocols - the Value Internet.

The development trajectory of the Internet

Looking back at the early development trajectory of the internet, the commercial internet emerged in the 1990s, and the "write" access permission promotion in the early 2000s gave rise to new platform business models. These platform businesses still dominate the internet today, covering social media, ride-sharing, e-commerce, app markets, and more.

Value Layer of the Internet

Circle adopts open-source standards and smart contract blockchain design for USDC, enabling developers to easily access the tools needed to build global, scalable digital dollar applications. This programmability and composability endow USDC with more powerful functions and application potential than traditional dollars.

Circle provides developers with a range of additional services aimed at making USDC easier for businesses and end customers to use. This includes several types of USDC-supported wallets that businesses can directly embed into their existing customer interfaces with just a few lines of code, as well as an ever-expanding library of smart contract templates that eliminates much of the complexity involved in creating applications on the blockchain.

Cultivating Developer Ecosystem

Circle is investing in the growth of the blockchain ecosystem and developer community. Hosting workshops globally and providing resources to make it easier for developers to harness the power of digital dollars.

So far, most of the activities of USDC developers have focused on deepening the connection between the blockchain ecosystem and traditional financial rails. These connections serve as on-ramps and off-ramps, making USDC more influential for existing payment use cases. These activities support and enhance the development of a stronger on-chain economy, where comprehensive financial activities connecting buyers, sellers, and merchants can be conducted natively on the blockchain.

Real-world Use Cases of USDC

Global USD Acquisition

The demand for the US dollar is strong outside the United States, whether for commercial or personal use. The use of USDC outside the United States has largely benefited from these factors, as well as its easier access compared to traditional bank dollars. Throughout the year, Circle has collaborated with established fintech companies, new banks, and other distributors, allowing them to deliver USDC directly to global customers.

Case:

• Nubank: The largest digital banking platform in Latin America, serving 105 million customers in Brazil, Mexico, and Colombia. In May 2024, it will launch USDC in Brazil in partnership with Circle.
• Lemon: The leading retail digital currency market in Latin America. Users hold a total of 137 million USDC, with a new user growth rate of 21%.
• MoneyGram: A global leading fintech company, covering over 200 countries and regions with more than 150 million consumers. Using USDC on the Stellar blockchain to facilitate dollar flows at internet scale.

digital asset market

In 2024, the digital asset market is experiencing strong growth, with a significant increase in mainstream adoption rates. USDC plays an increasingly important role in these markets. As the most widely used regulated stablecoin, USDC can eliminate risks for exchanges and their customers, serving as a liquid dollar base layer for trading, lending, storing value, and other activities.

Case:

• Coinbase: The world's leading compliant digital asset exchange. USDC plays an important role in Coinbase, accounting for a significant portion of trading liquidity and collateral.
• Bullish: An innovative digital asset exchange. Daily USDC trading volume reaches 1.3 billion USD, accounting for 83% of the total exchange trading volume.
• dYdX: Top decentralized exchange. Every trade on dYdX is settled almost instantly in USDC.

payment

USDC is driving the development of global payments, from merchant acquiring to remittances and B2B payments. USDC is well-suited to reduce costs and enhance the competitiveness of the $150 trillion cross-border transaction flow.

Case:

• Worldpay: An innovative global payment service provider. Became the first global merchant acquiring institution to offer direct USDC settlement in 2022.
• Mastercard: Global card organization network. Entering the fifth year of collaboration with Circle, supporting issuers and acquirers to settle transactions using USDC.
• Zodia Markets: Working with Standard Chartered Bank to promote cross-border payments for enterprises. A total of $4 billion in USDC raised throughout the year, with an average cross-border payment amount of $3.5 million.
• Stripe: The American payment giant. In 2024, it will allow merchants to accept stablecoin payments using USDC on the Ethereum, Solana, and Polygon blockchains.

humanitarian aid

USDC is beginning to provide more effective and safer alternatives for leading humanitarian aid organizations around the world. With just a mobile device and a digital wallet, value can be transferred globally via the internet, delivering aid with unparalleled speed, lower costs, and high auditability.

Case:

• UN Refugee Agency: United Nations High Commissioner for Refugees. Using USDC to distribute aid supplies to displaced persons has overcome many challenges of traditional cash distribution.
• Goodwall: A social platform that helps young people develop the key skills needed for future employment. Choose USDC for payment, leveraging its efficiency, cost, and coverage advantages.
• Ensuro: An innovative insurance provider. Utilizes USDC to ensure policyholders receive claim payments within minutes, particularly beneficial for economically vulnerable groups.

Outlook on Regulatory Policy Trends

Last year was a breakthrough year for legal and regulatory clarity regarding stablecoins. Around the world, emerging stablecoin regulations are effectively codifying how Circle operates, setting clear requirements in areas such as trust, transparency, and financial integrity.

Important progress:

• Circle becomes the first stablecoin issuer to comply with Canada's new listing rules.
• Circle expands its business in the Middle East by registering in ADGM
• Circle announces the establishment of a new global headquarters at One World Trade Center.
• Circle has become the first major global stablecoin issuer to comply with the EU MiCA regulations.

In the United States, the two parties have built a framework for principled rules that applies not only to stablecoins but also to the structure of the cryptocurrency market. By regulating stablecoins, the U.S. can help ensure that the digital dollar becomes the reserve currency of the internet.

It is expected that other major economies will follow suit in 2025, including the UK, Brazil, Hong Kong, and others. As more global financial centers engage in stablecoin activities.