According to a January 14 tweet, Tether USDT will process $18.2 trillion in transactions in 2022, surpassing traditional payment processors such as Visa and Mastercard.
In comparison, Mastercard and Visa processed $14.1 trillion and $7.7 trillion in transactions, respectively.
Tether’s high trading volume attests to the significant growth of the stablecoin over the past few years. Despite the challenges facing the crypto industry, stablecoins appeared to be thriving. Adoption of stablecoins has increased in countries where current economic conditions put their fiat currencies at a disadvantage.
2022 Tether hit hard
2022 has been a somewhat difficult year for Tether, despite the growing adoption of the stablecoin.
Over the past year, Tether has seen more concerns raised about its reserves and their solvency following the collapse of Terra UST in May and the FTX crypto exchange in November.
Stablecoins Temporarily Lost Peg to US Dollar at Terra Crash FUD High. During this period, the stablecoin issuer redeemed more than $10 billion of his. BeinCrypto later reported that several traditional financial institutions took short positions against his USDT.
USDT Market Cap Falls
USDT remains the dominant stablecoin in the crypto market, but rivals such as USDC and BUSD have recorded victory in 2022. For context, Tether’s market cap fell from its peak of $83.13 billion to $65.31 billion during the reporting period. Meanwhile, USDC’s market cap has increased to $56 billion before declining.
During this period, centralized cryptocurrency exchanges like Coinbase encouraged users to convert their USDT holdings to USDC. Recently, Crypto.com delisted USDT for Canadian users, citing regulatory compliance measures.
Glassnode data shows that USDC remittance volume exceeded USDT by almost five times by the end of 2022.
USDC’s assets are backed by cash or short-term US Treasury bills and are audited by global accounting firm Grant Thornton. Tether, on the other hand, is not very active regarding reserves and audits.
These issues have caused some cryptocurrency community members to question Tether’s data on trading volumes in 2022. Some believe the metric is for flushing transactions, while others ask stablecoin issuers to make their reserves public.
Disclaimer
BeInCrypto has reached out to the companies or individuals involved in the story to obtain an official statement regarding the recent developments, but has yet to hear back.
