A good proxy for digital asset spending is the flow of money coming out of exchanges. While only a portion will be used for real life purchases, analyzing the outflows of CEX & DEX can serve as a good indicator of the volume of digital assets being used for e-commerce or point-of-sale transactions.

This is not the most user-friendly journey, because users need to go through different platforms and pay fees to multiple third parties just to be able to spend their digital assets in the real world. That’s why solutions like Offblocks are important, so users can integrate cards with their wallets and leverage self-custodied assets for everyday transactions.

For this research, we selected 8 centralized exchanges and calculated their outflows based on on-chain data. Values are in USD and divided for each month of 2023. As we could expect, Binance is the dominant player in the CEX (Centralized Exchanges) industry, with outflows tapping more than 30 billion dollars per month in January and March. In 2023, average monthly outflows topped 25,323,995,663 dollars when we include Binance.

When we plot this same chart, but excluding Binance, we have an interesting picture of the space:

Excluding Binance, OKX, and Bitfinex are the biggest ones, with OKX constantly having outflows above 1 billion dollars every month and topping almost 4 billion dollars in March and December 2023. Also, excluding Binance, the average monthly outflows were $ 6,836,563,674.

When we analyze the average and median of outflows from these CEXs (still excluding Binance), the average of outflows per month for the whole year was $ 976,651,953 and the median was  $ 821,956,191.

When we sum all the outflows from these exchanges during 2023, was get the staggering value of 303,887,947,964 dollars.

We can also analyze outflows for DEXs (Decentralized Exchanges), here, focusing just on Ethereum. Although we cannot directly measure “outflows” in decentralized exchanges, since decentralized organizations don't have strict reporting obligations and it's difficult to precisely track all wallet addresses that interact with a specific protocol.

However, we can estimate outflows in decentralized exchanges (DEXs) by tracking the volume of stablecoins acquired in exchange for other tokens. This is because a portion of these stablecoins is likely to be used for payments. In our case, we analyzed the amount of USDC, USDT, and DAI, from January 2020 until December 2023.

From this chart, we can already see some interesting insights:

1. DAI was once a more dominant player in the stablecoin field than USDC and USDT. However, its dominance started to fall apart at the end of 2020 with the rise of Tether and Circle.

2. In the first half of 2020, buying volume for these stablecoins barely reached 1 billion dollars per month. However, in that same year, September reached almost 10 billion dollars in buying volume for DAI, USDC, and USDT.

3. During the bull market of 2021, that volume reached 40 billion dollars in May and was above $15 billion throughout the year from that point.

4. Even during the bear market of 2022, the volume slightly fell from 2021, however, it was consistently above $15 billion.

5. In 2023, the volume was way less than in 2022, however, it was still above 5 billion dollars per month during all year.

6. It’s also interesting to note that, although USDT coin has more holders than USDC, the USDC volumes remain consistently higher.

In just 3 years, the stablecoins buying volume in DEXs in Ethereum went from $101,083,365 in January 2020 to $12,749,250,500 in December 2023, a staggering 12,512.61%.

When we make the same analysis, but on BSC (Binance Smart Chain), we clearly see that USDT is the dominant player. The aggregated buy amount in BSC hit records during 2021, reaching more than 20 billion dollars in April and May of that year, and declining since then. Although it consistently reaches more than 2 billion dollars per month, it never reached the huge figures from 2021 since then.

On Avalanche, we have a curious setting. If USDT is the dominant player on BSC, USDC is the king on Avalanche. Here, however, the figures are much smaller than those in Ethereum and BSC, with the peak reaching more than 600 million dollars in 2021, but then consistently remaining below $ 200 million since July 2022. Monthly average buy amounts of USDC and USDT in Polygon were $ 1,574,186,249 in 2021,

$ 2,086,806,489 in 2022, and $ 1,099,974,975 in 2023.

Polygon is very similar to BSC in terms of volume growth, although here USDC is the dominant player. It reached a peak in June 2021, with more than 5 billion dollars worth of USDC and USDT being bought in Polygon DEXs. It also had more than 1 billion dollars per month in 6 out of the 12 months of 2023.

In EVM-based chains, Ethereum is still the king, but BSC and Polygon also have very relevant numbers, consistently reaching more than $ 1 billion of aggregated buy amount in USD for the biggest stablecoins.

For Solana, we analyzed the amount of stablecoins transferred on the chain since January 2021. It’s a very interesting picture.

Solana follows the patterns of the other chains we analyzed, with huge peaks during the 2021 bull market, and a lot less volume during 2022. However, in 2023 started to warm up again and reached a new all-time high in December 2023, reaching almost 300 billion dollars in stablecoins transfers on its chain. Important: Some specialists say that 90% of Solana’s stablecoin volume are tied to just 9 addresses of market makers, which would inflate numbers. This is worth investigating and taking into account.

We can also analyze how the two biggest stablecoins in the market - USDC and USDT - evolved their supply over time.

As we can see, USDT and USDC supplies were very correlated for years, until July 2022, when USDT continued to grow its supply, at the same time when Circle started to lower their supply. In almost 4 years, from January 2020 to December 2023, Tether grew USDT supply from $4,284,822,000 to $89,384,249,580, approximately 1986.07%. The stablecoin’s supply grew almost $ 40 billion between January and July of 2021, and almost $ 25 billion during 2023.

During the same time, Circle grew USDC supply from $463,662,457 to $24,620,430,550, approximately 5209.99% USDC supply decreased by almost $ 20 billion during 2023.

It’s also worth noting that stablecoins are already a huge market and could, in the future, threaten the dominance of legacy payments players like Mastercard and Visa. According to Bloomberg Intelligence analyst Jamie Coutts, in 2022, stablecoins in layer-1 chains settled 6.8 trillion dollars in transfers, against 1.36 trillion by PayPal and above $ 6.5 trillion by Mastercard, but still behind Visa, which registered 11.6 trillion dollars.

However, if we think that USDT was launched in 2014 and USDC in 2018, less than 10 years ago, these are impressive numbers and a great indicator of how big this market can be in the next few decades.