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USDT now commands 65% of stablecoin market cap

USDT now commands 65% of stablecoin market cap

According to reports from the issuer, Tether’s stablecoin market capitalization swelled to $83.2 billion, matching its previous peak achieved just over a year ago. USDT’s market cap took a major hit last year following the Terra-induced turmoil of mid-2022. It also came under pressure earlier this year and briefly lost its intended $1 peg amid the latest banking crisis.

The increased valuation of Tether was attributed to its “aggressive minting and issuance” on the Tron Network. The latter has a stronger presence in mainland China compared to Ethereum and places a greater emphasis on money transfers. Tether works across a diversity of different blockchains, including Algorand, Bitcoin Cash’s SLP, Ethereum, EOS, Liquid Network, Omni and Tron.

USDT’s market cap is now almost triple as much as that of USD Coin (USDC), the world’s second-largest stablecoin issued by the Boston-based company Circle.

Cryptocurrency traders have withdrawn more than $20 billion from USDC in less than three months even as concerns over the fallout from the Silicon Valley collapse have receded. The redemptions could easily be seen from a reduction in USDC’s market capitalization, which dropped from $43 billion before the crisis to nearly $28 billion, making the net outflow $15 billion. The massive outflows came even after Circle regained access to the $3.3 billion locked up in Silicon Valley Bank.

“Tether tokens offer a safe harbor for the unbanked and allow people in emerging markets to keep their buying power, even when their national currency is being devalued. Between our battle-tested resilience in the face of market volatility and our industry-leading transparency practices, Tether has proven that it can be trusted, and customers are responding in kind. We are eager to continue maintaining our laser focus on emerging markets and will not waver in our efforts to expand access to financial freedom globally,” said Paolo Ardoino, CTO of Tether.

USDT’s recent milestone reflects a complete recovery of the $18 billion that was lost following the collapse of Terra in May 2022, as well as the subsequent market downturn.

At the current circulating supply, Tether represents 7.25% of the $1.15 trillion cryptocurrency market capitalization and 64% of the $129 billion stablecoin economy, according to CoinMarketCap.

Tether, which is ranked the third biggest cryptocurrency by market cap, has been strengthening its dominance over the last few months after US regulators ordered Paxos to stop issuing.

Earlier this month, Tether said it earned nearly $1.5 billion in profits for the first three months of 2023, up from $700 million in the same period last year. According to its latest assurance report, the consolidated total assets held by the company as of March 31 amounted to at least $81.8 billion, a significant increase from the $67 billion reported at the end of 2022.

The post USDT now commands 65% of stablecoin market cap appeared first on FinanceFeeds.

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