Tether Dominates the Stablecoin Market
The Rise of Tether as the Leading Stablecoin
Tether (USDT) has once again established its dominance as the preferred pegged currency in the cryptocurrency market. With its stablecoin market share rapidly approaching 50%, Tether is proving to be as strong as ever, even as the SEC prepares to crack down on dollar-pegged tokens.
An Increase in Tether’s Circulating Supply
This year, Tether has deployed an additional $2.4 billion USDT, bringing its total circulating supply to $68.4 billion and marking a 3% increase. In comparison, USDC, Circle’s stablecoin offering, has seen a decrease in supply with a drop of more than $3.3 billion year to date.
Stablecoin Companies Enable Token Holders to Swap for US Dollars
Tether, Circle, and Paxos are among the stablecoin companies that allow token holders to exchange their stablecoins for US dollars. The supplies of stablecoins tend to decrease as tokens are burned upon redemption, but they are also frequently reissued to new consumers without being burned.
DAI Lags Behind the Top Three Stablecoins
With a market worth of roughly $5.19 billion, DAI, the decentralized stablecoin controlled by MakerDAO, trails significantly behind the top three stablecoins. In 2023, DAI has seen a decrease of $563.4 million, equivalent to a 10% drop in supply, making it the largest loser among top-tier stablecoins.
FRAX and TUSD Show Promising Growth
FRAX, with its algorithmic component, has remained consistent over the last three months and remains in fifth place. On the other hand, TrustToken’s trueUSD (TUSD) has shown promising growth, having added $190.4 million this year, a 25% increase in supply.
Stablecoin Market Shows a Minor Decrease
Despite the dominance of Tether and Circle, the stablecoin market as a whole has seen a 1.5% decrease, losing just over $2.1 billion. The total stablecoin dominance peaked at nearly 20% during the FTX crash in November, but has since fallen to 14.38% as the crypto markets have rebounded.