Yield Curve (2s10s) & Stablecoin Supply
· Updated daily
As of Apr 2026, the US 2s10s yield curve spread stands at +0.57% — 10-year Treasury yield (4.35%) minus 2-year Treasury yield (3.78%). The curve is currently Normal (uninverted). The 2s10s spread measures the shape of the yield curve: when positive, long-term rates exceed short-term rates and growth expectations are intact; when negative (inverted), short-term rates exceed long-term rates — a reliable leading indicator of recession that has preceded every US recession since 1978. The 2022–2024 inversion was the deepest in four decades, coinciding with stablecoin supply contraction from $180B to $130B as institutional capital rotated to short-term T-bills yielding more than long-term bonds. The curve uninverted in mid-2024; stablecoin supply has resumed growth since. Full history from Jan 2020.
Stablecoin Market Cap vs 2s10s Yield Curve Spread
Total stablecoin market cap (left axis, green, from Jan 2018) overlaid with the 2s10s spread (right axis, blue dashed, full history from Jan 2020). The dashed red line marks zero — below it the curve is inverted.
2s10s Spread — Full History with Inversion Periods
Daily 2s10s spread from Jan 2020 to present. The shaded area fills red when inverted (spread < 0) and blue when normal. The 2022–2024 inversion was the longest and deepest since the early 1980s. Regime bands mark each Fed policy period.
10Y vs 2Y Treasury Yields — The Spread Decomposed
10-year (blue) and 2-year (amber dashed) Treasury yields from Jan 2020. Inversion occurs where the amber line rises above the blue. The 2-year yield tracks Fed policy expectations closely; the 10-year yield reflects long-run growth and inflation expectations.
During the zero-rate era the curve was positive and relatively steep — long-term rates exceeded short-term rates, reflecting normal growth expectations. Risk assets including DeFi were attractive, and stablecoin supply grew from ~$6B to ~$180B (BIS WP 1068, 2023).
For macro investors: A steep positive curve is consistent with stablecoin supply expansion — institutional capital has no incentive to pile into short-term T-bills when the curve rewards duration.
The Fed's aggressive hiking cycle drove 2-year yields above 10-year yields. Institutional capital rotated into short-term T-bills yielding over 5% — more than 10-year bonds. Stablecoin supply contracted from ~$180B to ~$130B as the inversion deepened. The inversion also raised recession fears that suppressed crypto risk appetite broadly.
For CFOs: Curve inversion is a signal to review DeFi allocations — 2-year T-bills are yielding more than 10-year bonds, making short-duration cash instruments hard to beat on a risk-adjusted basis.
Despite the curve remaining inverted at its deepest levels, stablecoin supply stopped contracting and began recovering from ~$130B. Markets were pricing in future rate cuts ahead of actual FOMC action. The curve slowly uninverted through 2024 as 2-year yields declined with cut expectations.
For macro analysts: Supply recovery during still-inverted curve conditions illustrates that stablecoin allocation responds to rate expectations, not just the current curve shape. Watch 2-year yield moves as the leading signal.
The curve fully uninverted as the Fed began cutting rates in September 2024 and 2-year yields declined below 10-year yields. Stablecoin supply has resumed growth, reaching well above $200B, consistent with improved risk appetite and reduced competition from short-term instruments.
For DeFi risk teams: Curve normalisation historically precedes renewed institutional inflows — monitor collateral utilisation and redemption pressure as capital returns on-chain. For regulators: Supply expansion in a normalising curve environment is structurally driven.
Spread computation: 2s10s spread = DGS10 (10-year nominal Treasury yield) minus DGS2 (2-year nominal Treasury yield). Both series published daily by the Federal Reserve and fetched from FRED. Coverage: January 2020 – present. Denominated in percent per annum.
Inversion definition: The curve is defined as inverted when the spread is negative (DGS2 > DGS10). No smoothing or threshold adjustment applied — the raw daily spread is used.
Forward-filling: Both series are not published on weekends or US federal holidays. Missing values are forward-filled from the last available observation. Data gaps are not interpolated.
Stablecoin market cap: Daily sum of all tracked stablecoin market caps from CoinGecko snapshots (322 coins) and extended history from DefiLlama. Coverage: Jan 2018 – present.
Regime bands: Set to actual FOMC meeting dates — not model-estimated. The Fed Regime stat box reflects the current active regime and is updated within one business day when the FOMC acts.
Update frequency: Daily at ~15:30 UTC (FRED series published with a 1-business-day lag).