CCData Report: Fed's Rate Cuts Expected to Slash $1.56 Billion in Stablecoin Interest Revenue

According to  CCData report: The Federal Reserve's first interest rate cut since March 2020 is projected to significantly impact the revenue of major centralized stablecoins. With nearly $125 billion in U.S. Treasuries backing the reserves of these stablecoins, each 50 basis point rate cut could lead to a $625 million loss in interest income.U.S. Treasuries currently make up 80.2% of the reserves of the top five centralized stablecoins, including Tether's USDT and Circle's USDC, which hold $93.2 billion and $28.7 billion in Treasuries, respectively. Other stablecoins like FDUSD, PYUSD, and TUSD hold smaller Treasury-backed reserves.The market anticipates a total rate cut of 75 basis points by the end of 2024, potentially resulting in a cumulative revenue loss of $1.56 billion for these stablecoins. Despite this expected financial setback, the stablecoin market has demonstrated resilience, with its total market capitalization increasing by 1.50% in September to reach $172 billion—marking 12 consecutive months of growth.