Recent Trends in Euro to US Dollar Exchange Rate
Recent analysis from CoinDesk reveals significant fluctuations in the Euro to US Dollar exchange rate, which has climbed 12.88% since the beginning of the year. The EUR/USD pair surged from 1.0354 to close to 1.17, marking its highest position since September 2021.
Factors Influencing the Exchange Rate
This rise is attributed to a weakening correlation between the interest rates set by the Federal Reserve and the European Central Bank, alongside a broader market trend favoring the Euro over the US Dollar.
Performance Comparison
Furthermore, the EUR/USD’s performance has been robust, outpacing major US indices like the Nasdaq and S&P 500 and nearly mirroring Bitcoin’s impressive valuation climb. Interestingly, the correlation between EUR/USD and Bitcoin has intensified, with a 90-day correlation coefficient hitting 0.62—its highest since February 2024.
Market Capitalization of Euro-Denominated Stablecoins
Additionally, there has been a noteworthy surge in the market capitalization of Euro-denominated stablecoins, which increased by 44% this year, from $310 million to $480 million. Circle’s EURC stablecoin alone has seen a dramatic rise of 138%, bringing its market valuation to $200.36 million.
Overall Market Context
Despite this growth, it is essential to note that Euro-backed stablecoins still constitute less than 1% of the total market cap of US Dollar-backed stablecoins, which currently stands at a staggering $2,548.8 billion.
