The market capitalization of the USD1 stablecoin issued by World Liberty Financial dropped by more than $400 million over a two-week period. Data from CoinGecko indicates the market cap fell from $4.43 billion on October 6 to approximately $4.02 billion, representing a 9.1% decline.
Research firm Onchain Benchmark reports that the reduction was driven by significant redemptions on the Ethereum and BNB Chain networks. Between October 6 and October 15, Ethereum saw $184.60 million in net redemptions across 63 burns, while BNB Chain recorded $200.43 million across 12 burns.
A single unidentified address accounted for nearly $200 million of the redemptions on BNB Chain, executing transfers in batches of $30 million to $50 million. On Ethereum, over 99% of redeemed tokens were processed through a wallet associated with the custodian BitGo.
Despite the decrease in circulating supply, the stablecoin maintained its peg to the dollar, trading between $0.998 and $1.000 throughout the period. The supply of USD1 on the Solana network remained stable at approximately $1.42 billion during the nine days analyzed by researchers.
The decline in USD1 supply on Ethereum was more pronounced compared to other dollar-denominated stablecoins, with an 11.45% drop. Analysts note that future supply levels will depend on the decisions of large holders and the upcoming transition to a new issuer for the token.
