Report: Despite USDT dominating CEX trading volume, USDC trading pairs have gained a significant share in the spot market

The latest Coin Metrics Network Status Report points out that the demand and capital inflow for Bitcoin exchange-traded products are unprecedented, making it the fastest-growing ETF product in history. Since its launch a quarter ago, about $12 billion has flowed into these products, accounting for approximately 4% of Bitcoin's current supply. Among the 11 issuers, BlackRock's IBIT is undoubtedly the winner, having accumulated nearly 250,000 Bitcoins (approximately $17 billion) since its establishment. Other issuers have also gained market share. In contrast, Grayscale's GBTC has been experiencing significant capital outflows due to high fees and the impact of Genesis and FTX bankruptcy. Although there may be occasional fluctuations in fund flows with some days being exceptionally active, the launch of Bitcoin spot ETFs undoubtedly lays a foundation for broader rises in digital asset markets. The first quarter gave us a glimpse into strong market demand for these products; however participants will closely monitor their lasting appeal and impact as derivative ETFs join.

The report further pointed out that with increasing valuations in digital asset markets stablecoins resumed their expansion trend during Q1. Dollar-pegged stablecoin supply exceeded $135 billion this quarter representing an increase of 13.5%. Tether (USDT)'s circulation broke through $100 billion with Ethereum-based circulation growing by 16% while Tron network-based circulation grew by 11%. Circle’s USDC had a strong start to Q1 expanding its supply by 22% reaching $27 billion - close to levels seen during last year’s regional banking crisis period Despite USDT dominating centralized exchange volumes USDC trading pairs are gaining influence on spot markets as liquidity improves This growth in leading stablecoin market shares is partly due to Paxos' BUSD shutdown and overall increased demand for digital assets.

The report also stated that despite speculation and frenzy permeating markets progress has been made on multiple fronts from "the launch of Bitcoin spot ETFs infrastructure upgrades and adoption across Layer1 and Layer2 ecosystems paving the way for broader usability and innovative use cases". Because we "with SBF's ruling have cast off the shadow looming over the entire industry". Looking ahead, "various upcoming developments may shape the future of digital asset industry." However, "The resumption of Coinbase's case with SEC potential launch of Ethereum ETFs and Bitcoin rapidly approaching its fourth halving will undoubtedly keep participants vigilant."