USDC, Circle’s once-battered stablecoin, has finally officially pulled off a full recovery from the disaster of FTX’s collapse. Its market cap is back at $56.2 billion, matching what it was before the crypto giant fell apart in November 2022, according to data from CoinMarketCap.
At some point in early 2023, USDC actually tumbled all the way to $24.5 billion. Unlike its rival, Tether’s USDT, which hit recovery mode in April 2024, USDC took a long way back.
Now crypto markets have been enjoying a boost since Donald Trump returned to the White House, with his pro-crypto executive order helping stablecoins make serious gains. The order, which was signed on Jan. 24, talked about supporting dollar-backed stablecoins to “promote the growth of lawful and legitimate” financial tools globally.
FTX collapse put USDC on life support
In November 2022, when FTX filed for bankruptcy, the panic among investors was immediate. Over $6 billion in USDC was redeemed within 72 hours, causing its market cap to shrink from $44.5 billion to $38 billion in a flash. People wanted liquidity, and USDC was one of the fastest routes back to dollars.
Circle couldn’t even catch its breath before Binance made things worse. From September 2022 to February 2023, Binance automatically converted users’ USDC balances into its own stablecoin, BUSD. That wiped out over $3.7 billion in exchange-held USDC, cutting off liquidity until Binance walked back its policy in early 2023.
Then March 2023 happened. Circle was caught in the crossfire of yet another collapse; that of Silicon Valley Bank. This bank had $3.3 billion of their cash reserves tied up in SVB when the bank went under. For a brief but brutal moment, USDC’s peg broke and the stablecoin dropped all the way to $0.8 on March 11.
By the time 2023 wrapped up, USDC had hit rock bottom at $24.5 billion. Circle was down but not out. The company launched an aggressive recovery plan, backed by strategic partnerships, regulatory engagement, and a focus on boosting liquidity.
By January 2024, USDC had climbed back to a market cap of $35.7 billion. Just one year later, in February 2025, it hit $56.2 billion, finally back to pre-FTX levels.
One of the key drivers of this recovery was institutional adoption. Big-money investors started choosing USDC over USDT, with daily transactions surging from 23,450 in early 2024 to over 51,000 by 2025. Ethereum network volumes doubled from $2.3 billion to $4.5 billion per month, and transactions on Polygon more than doubled.
Meanwhile, US lawmakers did their part by introducing a stablecoin regulation bill in January 2025. The bill requires stablecoin issuers to be officially licensed as “permitted payment stablecoin issuers.” Financial Services Committee Chair Rep. French Hill and Digital Assets Subcommittee Chair Rep. Bryan Steil led the bipartisan push.
Circle’s CEO, Jeremy Allaire, praised the legislation, calling it “a tremendous opportunity to strengthen the US dollar and drive enormous innovation.” But Tether still rules the stablecoin market with a $96.4 billion market cap, though in January, USDC led Tether in daily transaction volume, with over 51,000 transactions compared to USDT’s 38,200, according to on-chain data.
