Stablecoins Soar as Market Volatility Drives Flight to Safety

Investor appetite for stablecoins has surged in 2025, driven by ongoing market volatility and elevated interest rates. Seen as a safe haven in a turbulent financial environment, they have gained traction not only among retail users but also with institutional investors and fintech firms.

Backed by growing regulatory clarity and smoother integration into digital finance ecosystems, stablecoins are rapidly becoming a foundational layer of the crypto economy. As a result, the sector’s total market cap has seen substantial growth this year.

According to data presented by CryptoPresales.com, the combined market cap of all USD stablecoins had jumped by nearly 20%, reaching over $240 billion last week.

Most Major USD Stablecoins Grow, but BUIDL Token Skyrockets Over 600% YTD

While crypto investors often chase high-risk, high-reward opportunities, many have turned to stablecoins for security in 2025. Regulatory uncertainty, global macroeconomic stress, Donald Trump’s tariff policies, and escalating trade wars have rattled the crypto market, making stablecoins the most sought-after digital safe haven. Their market cap surged over the past four months, and the CoinMarketCap data show just how significant that growth was.

On January 1, the combined market cap of all USD stablecoins amounted to $203.3 billion. Since then, this figure has increased by nearly 20%, reaching over $240 billion last week. While most have seen a solid market cap growth since the beginning of the year, one name stands out.

With a massive 617% year-to-date surge, the BUIDL token, native to the BlackRock USD Institutional Digital Liquidity Fund, leads all USD stablecoins in market cap growth. In 2025, it saw soaring adoption among both crypto-native users and institutional investors, emerging as a top trusted on-chain alternative to traditional money markets by offering daily yields backed by U.S. Treasuries.

All other major USD stablecoins lagged far behind BUIDL’s triple-digit growth. Tether, the world’s largest USD stablecoin by market cap and the most-traded crypto, grew just 8% YTD to $148 billion. USDC and USDS followed with solid gains of 40% and 49%, respectively, while PayPal USD stood out with an impressive 89% surge.

The market cap of Ethena USD dropped by 20% to $4.6 billion since January, First Digital USD declined by 32%, while Usual USD saw a massive 89% decrease.

Stablecoins Now Hold Over 8% of Crypto Market Cap, 3% More than Last Year

With USD stablecoins seeing a significant 20% market cap growth in four months, their market share in the crypto space has also increased. Last week, they accounted for over 8% of the total crypto market cap, or 3% more than last May.

Bitcoin, the world’s largest and most expensive crypto, has also seen its market share grow. Last week, Bitcoin made up around 63% of the total crypto market cap, up from 53% last May.

On the other hand, many altcoins are losing ground as ongoing uncertainty and market volatility push investors to more stable, reliable assets. Last week, altcoins held around 29% of the total crypto market, down from 42% in the same month a year ago.