When traders and investors exit their crypto asset positions, they usually convert them into stablecoins before taking them off exchanges as fiat. That exodus has been going on for the past six weeks, causing the stablecoin market share to grow.
Furthermore, this is despite the reduction in the supply of the world’s largest one, Tether. It is also despite the massive hole left by the collapse of Terra’s UST stablecoin, once the third-largest.
According to CoinGecko, the combined market cap of all stablecoins is $155 billion. The total crypto market cap is $943 billion, meaning stablecoins represent 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 USDT and USDC dominance has never been this high. Large redemptions from the Tether ecosystem have resulted in a supply cut, meaning “big players completely exiting the ecosystem,” they added.
USDT and USDC dominance has never been this high before.
USDT mcap even declined because of large redemptions which means big players completely exiting the ecosystem.
Think this says something about how bearish sentiment is rn. pic.twitter.com/urYkSigUkk
— Byzantine General (@ByzGeneral) June 22, 2022
Tether remains the leading stablecoin in terms of market share, which is 43%. Its supply has decreased by 19% since its record high of 83 billion USDT in early May. There is currently 67 billion USDT in circulation, according to the firm’s transparency report.
Tether has trimmed around $3 billion over the past seven days as its supply continues to shrink. This leads to a dwindling market share as the same isn’t happening with Circle’s USD Coin.
USDC has a market share of 36%, with 56 billion coins in circulation. Furthermore, it has not had the same supply cuts as its rival and is hovering around all-time high circulation levels. Regulatory and treasury concerns continue to shadow Tether. This is why many have switched to USDC, which is fully backed and regulated.
Both of these dominate the stablecoin ecosystem with a combined market share of just under 80%.
Tether to Launch GBPT
On June 22, Tether announced that it was launching another stablecoin. The new addition will be called GBPT, pegged to the British Pound.
It will launch in July, becoming the firm’s fifth stablecoin after USDT, EURT, Chinese Yuan CNHT, and the Mexican Peso pegged MXNT.