The stablecoin market records its first pullback in more than two years.

Source: CritpoTendencia Original Title: The stablecoin market records its first monthly decline in more than two years Original Link: The global capitalization of stablecoins is set to experience its first monthly decline in 26 months this 2025, according to the report published by CoinDesk Data.

This contraction, although moderate, marks a trend change for a key segment of the crypto ecosystem and reinforces risk analyses and portfolio adjustments in the industry.

For the first time in 26 months, the total market capitalization of stablecoins has recorded a monthly decline. This not only means fewer tokens in circulation but also that more stablecoins are being redeemed than issued. Capital is being withdrawn rather than increasing, and that matters.

Capitalization Adjustment: Cooling Signals for Stablecoins

The total market value of stablecoins closed the month at $303 billion, representing a decrease of 1.48% —equivalent to about $4.54 billion— compared to the previous month. The combined volume between spot and derivative trades also decreased, settling around $1.48 trillion.

Tether (USDT) maintained its dominance with nearly $184 billion in circulation, while USDC and other issuers recorded a decrease in their market capitalization. This adjustment reflects lower demand for defensive positions and a technical reconfiguration among traders and institutions.

The contraction responds to various factors: reduced exposure to risk, lower speculative activity, and liquidity adjustments in an uncertain macroeconomic environment. Additionally, large holders have reorganized portfolios prioritizing liquid reserves and low volatility, in line with the prevailing caution in global financial markets.

Alternative advances and diversification away from the dollar

Despite the setback in the leading segment, some alternative stablecoins showed remarkable growth. RLUSD surpassed $1 billion in capitalization after a monthly increase of 27.3%.

A historic high was also recorded in euro-denominated stablecoins, which evidences a growing diversification towards currencies other than the US dollar.

This partial migration could be due to the search for lower currency exposure and stricter regulatory frameworks in traditional markets.

The increasing institutional interest in new options and alternative currencies reflects a hedging strategy and adaptation in response to potential regulatory changes at the international level.

Implications for Portfolio Management and Future Outlook

The decline in the capitalization of stablecoins marks a technical pause after a sustained growth cycle. For investors and professional managers, this adjustment implies reviewing the quality of reserves, optimizing liquidity, and monitoring regulatory risk.

Stablecoins with greater transparency and solid backing, such as USDT and RLUSD, are emerging as preferred options in tense scenarios.

The correction could also accelerate regulatory debates and motivate issuers to strengthen auditing and disclosure practices. For their part, international regulatory bodies have warned about the systemic risks associated with the expansion of these assets, so a more demanding environment is anticipated in the coming months.