Stablecoin Market Shake-Up: Tether Skyrockets to All-Time High as Competitors Plummet

Stablecoin Market Shake-Up: Tether Skyrockets to All-Time High as Competitors Plummet

Tether USDT Returns to All-Time High as Other Stablecoins Decline

In the past year, there have been notable shifts in the dominance of stablecoins tied to the US dollar. Recent statistics compiled by CoinGecko reveal that Tether USDT has reclaimed its all-time high, while the majority of cryptocurrencies are experiencing a downward trend.

Circle’s USDC has seen a decrease in its market share from 34.88% to 23.05% over the past 12 months. Similarly, Binance USD’s market share has dropped from 11.68% to 4.18%, and Dai’s portion of the cryptocurrency market has fallen from 4.05% to 3.66%.

FILE PHOTO: Tether logo is seen in this illustration taken March 31, 2023. REUTERS/Dado Ruvic/Illustration

Favorable Political Climate

In contrast, Tether’s native currency, USDT, is on the rise. Its market share for stablecoins now stands at 65.89%, a significant increase from 47.04% a year ago. The market value of USDT has surged to $83.1 billion, up from its previous high of $55 billion, while USDC’s valuation has decreased to $29 billion.

Circle CEO Jeremy Allaire recently attributed the decline in USDC’s market value to the crackdown on cryptocurrencies by US authorities during an interview with Bloomberg. The current political climate in the United States seems to be more favorable for Tether.

Following the closure of three crypto-friendly banks, including Silicon Valley Bank, by authorities in March, approximately $3.3 billion in reserves became stranded. As a result, USDC experienced a detachment from the US dollar due to the financial crisis in the country. Despite Circle’s reassurances, the market’s immediate reaction to this announcement led to USDC depegging from its peg to the dollar.

Stablecoins have gained popularity as the cryptocurrency industry becomes more integrated into the financial mainstream. A recent study by the European Systemic Risk Board called for greater transparency regarding stablecoin reserves in the digital assets market.

Compiled by Coinbold