Analyst: Stablecoins are becoming core infrastructure for on-chain finance

Stablecoins are establishing themselves as the core infrastructure for on-chain finance, according to a CryptoQuant contribution from crypto analyst XWIN Research Japan. The analyst noted that on-chain data shows the number of active ERC-20 stablecoin addresses has increased rapidly in recent years, with their use expanding across various sectors including trading, payments, and DeFi. The current stablecoin market capitalization is around $300 billion, with USDT and USDC serving as the primary sources of liquidity. Their use cases vary globally. In high-inflation countries like Nigeria, they function as a digital dollar, while in India and the Philippines, they are used for overseas remittances. In the U.S., their main use is to supply liquidity to financial markets. Meanwhile, Japan is also seeing expanded adoption of yen-based stablecoins like JPYC following recent regulatory developments, the analyst added.