Stablecoins have become one of the highlights of the cryptocurrency industry. According to Glassnode analysis, stablecoin supply in 2022 peaked at $160 billion in March, before Luna collapsed. Since its peak, stablecoins have seen outflows of $4 billion to $8 billion per month.
Glassnode further emphasized that Tether’s dominance in the stablecoin market is waning. Tether’s dominance in the crypto stablecoin space has dropped from around 80% to 45%-50%. USDC, on the other hand, was steadily gaining dominance, but fell over the summer. Also, his BUSD on Binance has seen steady growth in market strength from 10% at the beginning of the year to around 16%.
Glassnode data shows that Tether continues to dominate, with BUSD rising while USDC is falling.
Additionally, the crypto analytics firm pointed out that in 2021, daily remittance volume will reach about $16 billion. This indicator he has increased since May 2022. The company highlights that stablecoin remittances are increasing as the price of Bitcoin (BTC) falls.
Will Tether Hold the Crown of Crypto Stablecoins?
Tether is still the largest stablecoin by market cap. Token value is his 3rd place behind Bitcoin and Ethereum respectively 1st and his 2nd. However, Tether has come under a lot of scrutiny as it does not disclose its reserves and audit reports.
In a recent post, Tether said it would cut its reserve secured loans to zero in 2023. However, Tether stressed that the secured loans are well secured and backed by “very liquid assets.” According to the company, Tether’s secured loans work similarly to commercial banks, which use secured collateral to lend to customers. Tether, on the other hand, claimed that its loans were over 100% backed, unlike banks that operate on fractional reserves.
As pointed out by Glassnode, Tether’s dominance over the stablecoin market has been slowly waning over time. Given this trend, the company’s dominance may eventually be overtaken by other growth companies.
