2014: the first experiments

On July 21, 2014, BitUSD launched on the BitShares blockchain — the first stablecoin, created by Dan Larimer and Charles Hoskinson. It was over-collateralized with BTS tokens and held its peg in calm markets, but lost it permanently in 2018 as BTS crashed. That September, NuBits launched with a two-token model (NBT and NSR) relying on seigniorage rather than direct collateral. NuBits depegged to around $0.15 in 2016, then collapsed for good in March 2018 to about $0.25 and never recovered — an early example of an under-collateralized design failing.

2014–2017: Tether and the fully-reserved model

On July 8, 2014, Brock Pierce, Reeve Collins, and Craig Sellars founded the project as "Realcoin"; the first 100 tokens were minted on October 6, 2014 on the Omni layer atop Bitcoin, and the project was renamed Tether on November 20, 2014. Bitfinex became the first exchange to trade USDT in January 2015. On December 18, 2017, DAI launched on Ethereum via MakerDAO (founded by Rune Christensen in 2014) — the first over-collateralized crypto stablecoin, backed entirely by ETH; DAI held its peg even as ETH's price fell more than 80% in the protocol's first year.

2018: fiat-backed competition grows

In October 2018, Circle and Coinbase jointly launched USDC under the CENTRE Consortium, founded in 2018: the token was fully collateralized 1:1 with US dollar reserves, publicly reported. Circle later consolidated full ownership of USDC and wound down CENTRE in August 2023.

May 2022: the algorithmic model collapses

Terra's UST held its peg not through reserves but through a mint-and-burn arbitrage against its sister token LUNA: burning $1 of LUNA minted 1 UST and vice versa, with no hard reserve behind it. On May 7, 2022, roughly $2 billion was withdrawn from the Anchor lending protocol, triggering panic selling and pushing UST below $1. Arbitrageurs began burning discounted UST for LUNA to sell, which required minting enormous new LUNA supply — its price collapsed, destroying the very mechanism meant to defend the peg (a "death spiral"). By May 13, UST traded around $0.045 and LUNA had effectively gone to zero; the Terra ecosystem lost roughly $50 billion in value over about three days. Shortly after, US Treasury Secretary Janet Yellen urged Congress to regulate stablecoins, and G7 finance officials asked the FSB to accelerate its crypto-asset regulatory work.

March 2023: USDC depegs as SVB fails

Silicon Valley Bank failed on March 10–13, 2023; Circle disclosed that $3.3 billion of USDC's reserves (about 8%) were held at the bank. USDC depegged, falling to $0.87–$0.88 over the weekend of March 11; more than $1 billion in USDC was redeemed on March 10 alone. The peg was restored after US regulators announced SVB depositors would be made whole, with USDC back near $1.00 within about three days. That same year, on August 7, 2023, PayPal launched PYUSD through Paxos Trust Company, regulated by the New York State Department of Financial Services — the first major traditional-payments company to issue a dollar stablecoin.

2023–2025: regulation catches up

The EU's MiCA regulation (2023/1114) was published in the EU's Official Journal on June 9, 2023; the EMT/ART rules for stablecoins became applicable on June 30, 2024, and the broader crypto-asset service provider regime on December 30, 2024. In the US, the GENIUS Act passed the Senate on June 17, 2025 (68–30), the House on July 17, 2025 (308–122), and was signed into law on July 18, 2025: it requires payment stablecoins to be reserved 1:1 in cash and short-term Treasuries, mandates monthly public reserve disclosure, and bars issuers from paying interest to holders. On June 5, 2025, Circle IPO'd on the NYSE at $31/share — above its stated range — selling 34 million shares for about $1.1 billion; shares opened trading at $69 on debut.

2025–2026: new models, institutional issuers

Ethena's synthetic dollar USDe (launched 2024) grew from under $6 billion in market cap at the start of 2025 to a peak above $14 billion (about 5% of total stablecoin supply) during 2025, before contracting in a Q4 2025 deleveraging event. Banks are building a parallel tokenized-deposit track: JPMorgan's deposit token JPMD (via its Kinexys platform) went live on the Base network in 2026 for institutional cross-border payments, while JPMorgan, Citi, Bank of America, and Wells Fargo are separately building a shared Tokenized Deposit Network via The Clearing House, targeting a first-half-2027 launch. As of its Q2 2026 attestation (audited by BDO), roughly $184.6 billion in USDT was in circulation.