According to DeFiLlama data, the total supply of U.S. dollar Stablecoin USDC has dropped from $55.55 billion to $46.57 billion in the past 90 days. This means that USDC issuer Circle has destroyed about $9 billion worth of Stablecoins during this period, setting a record for the highest destruction of USDC in a 90-day period so far.
When a user converts USDC to the base currency that backs the Stablecoin (usually USD), Circle sends the redeemed tokens to a burn address to burn USDC and permanently delete those tokens from blockchain records.
Analysis shows that the surge in USDC burns Coincides with a significant drop in yields offered by major DeFi platforms to Stablecoin lenders. According to data from LoanScan, USDC’s lending rates to Compound and Aave have shrunk by more than 70% since the beginning of the year.
