USDC hits $50 billion market cap landmark
USDC, a stablecoin pegged to the US dollar, is hot on the heels of the leading stablecoin Tether, better known as USDT. While the Goldman Sachs backed USDC has witnessed growth of more than 17% in its market capitalization, reaching a landmark $50 billion. USDT has dropped by almost 1% over the last 30 days.
Stablecoins represent various opportunities but are widely utilized by investors to move in and out of trading positions. More recently, they have been used to make passive income, with some platforms offering upto 10% on stablecoin savings. As the battle for domination continues against a backdrop of new stablecoin projects arriving on the market, the world’s two leading stablecoins are fighting it out.
Just a year ago, the top five stablecoin list would not have included TerraUSD, the native stablecoin of the Terra network. Who’s TVL currently stands at over $13 billion, growing from around $100 million a year ago. Furthermore, BUSD being present is a testament to Binance Smart Chain’s impressive growth as a trading platform since launching less than 18 months ago. However, it’s clear to see there are only two stablecoins really in contention to hold the top spot in the immediate future.
USDC takes market share
The total stablecoin supply is currently $176 billion, equating to around 10% of the entire cryptocurrency market capitalization. Tether commands about 45% of that total, whereas USDC now holds a 29% share as the gap closes. With over $78 billion market capitalization, Tether is still the dominant force in the stablecoin ecosystem, but the Goldman Sachs-backed USDC is mounting a serious charge.
A key motivator behind having a native stablecoin is that it can stimulate much needed trading volume for dapps and the networks they run on. As the multi-chain paradigm continued throughout 2021, a slew of new blockchains, dapps, and decentralized exchanges arrived on the scene. Some of these platforms have launched their stablecoins to aid traders on their specific networks. Magic Internet Money introduced its MIM token, while the Celo dollar is also gaining traction and helping grow the network’s TVL significantly.
Additionally, stablecoin projects are now looking outside US dollar pegs to offer traders their native currency, for example, Euro Tether (EURT). This can make things much easier for vendors and retailers looking to transact in the euro and not suffer the volatility of foreign exchange rates. Greatly assisting more real-world use cases to take and send payment in their native currency.
USDC’s supply already flipped USDT on the Ethereum network in the third week of January 2022. Tether supply is currently split primarily between Ethereum and Tron with around $39 billion and $36 billion USDT on each network, respectively, and the rest on a handful of others such as Solana and Algorand, according to its transparency report.
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The above does not constitute investment advice. The information given here is purely for informational purposes only. Please exercise due diligence and do your research. The writer holds ETH, BTC, AGIX, HEX, LINK, GRT, CRO, OMI, IMMUTABLE X, GALA, AVASTR, GMEE, CUBE, RADAR, FLOW, FTM, BNB, SPS, WRLD, ATOM, and ADA.
