Stablecoin Growth Slowed as Deposit Rates Rose, USDC Most Exposed: Working Paper

The finding reframes stablecoins as rate-sensitive cash substitutes rather than purely crypto-native instruments, which matters for issuers whose growth models assumed structural demand. USDC's greater exposure suggests its holder base is more yield-conscious than rivals', a competitive vulnerability if rates stay elevated. The authors' own caveat—one high-rate period, six years of weekly data—limits how far the result generalizes, and whether the relationship holds across rate cycles is the open question. Watch whether stablecoin supply growth tracks deposit-rate moves in future data.