When traders and investors exit their crypto asset positions, they typically convert them to stable coins before being closed off as fiat on exchanges. This exodus has been going on for the past six weeks, increasing the share of the stablecoin market.
Furthermore, this is despite a decrease in the supply of the world’s largest Tether. This is also despite the large hole left by the collapse of Terra’s UST stablecoin, which was once the third largest.
According to CoinGecko, the combined market capitalization of all stablecoins is $155 billion. The total crypto market cap is $943 billion, which means that stablecoins account for 16.4% of the total. Half of the top six cryptocurrencies by market cap are now stablecoins.
Tether remains dominant
Industry observer ‘Byzantine General’ commented that the dominance of USDT and USDC has never been so high. The large redemption from the Tether ecosystem has resulted in supply cuts, meaning “big players are exiting the ecosystem entirely,” he said.
The dominance of USDT and USDC has never been so high.
The USDT mcap also declined due to the large redemption, which means the big players are exiting the ecosystem entirely.
Think this says something about how bearish sentiment rn. pic.twitter.com/urYkSigUkk
— Byzantine General (@ByzGeneral) 22 June 2022
Tether continues to be the leading stablecoin in terms of market share, standing at 43%. Its supply is down 19% since its record high of USD 83 billion in early May. According to the firm’s transparency report, there is currently 67 billion USDT in circulation.
Tether has cut nearly $3 billion over the past seven days as its supply continues to dwindle. This leads to a decreasing market share as this is not happening with Circle’s USD coin.
USDC has a market share of 36% with 56 billion coins in circulation. Furthermore, it hasn’t had the same supply cuts as its rival and is hovering around all-time high circulation levels. Regulatory and Treasury concerns continue to plague Tether. This is why many people have switched to USDC, which is fully supported and regulated.
These two dominate the stablecoin ecosystem, with a combined market share of just under 80%.
Binance is the third largest stablecoin with a supply of USD 17.6 billion coins, with a market share of 11.3%. The supply of BUSD has remained stagnant for the past four months, and the coin has not been carried or burned any more.
Tether to launch GBPT
On June 22, Tether announced that it was launching another stablecoin. The new addition will be called GBPT, which is pegged to the British pound.
It will launch in July, becoming the firm’s fifth stablecoin after USDT, EURT, Chinese Yuan CNHT and Mexican Peso MXNT.
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