What $USDC and $USDT regressions show

The opposing return relationships show why issuer composition matters. Coin Metrics’ study uses weekly observations over four years, testing six drivers from the previous week against subsequent supply growth. Higher perpetual-futures funding rates associate with faster growth for both issuers, accounting for about 10% of $USDC’s weekly supply-growth variation and 4% of $USDT’s after controls.

A separate analysis starting in 2023 uses the gap between lending protocol Aave v3’s annual percentage yield, or APY, and a three-month Treasury yield. This carry spread adds significant explanatory information for $USDC, but no meaningful increment for $USDT or combined supply beyond funding.

The…