Tether’s USDT Circulating Supply Sees Uptick After 3 Consecutive Months of Declines
The bear market has been merciless. But could Tether’s rise imply that the cryptocurrency market is headed for a recovery curve?
After three months of continuous slumps, Tether’s USDT supply is starting to rise again. This trend could be indicative of a potential market recovery.
The market cap of the world’s largest stablecoin saw a modest uptick of around 0.7%. The cash injected into USDT has been relatively small and was under $500 million. The first mint in three months took place on July 29th. So far, four mints have occurred till August 2nd. Nonetheless, industry experts believe this to be bullish for the overall sector.
Capital Injection into Tether (USDT)
Van Eck Associates Corp.’s Gabor Gurbacs, for one, said that the injections could either mean new capital getting invested or old capital moving back to the space. In either case, it’s a win-win. His tweet read,
“Tether (USDT) picks up a $350 million market cap increase in the past 4 days. More cash injected into the stablecoin space may imply further market growth. If new capital is moving in, then that could mean new dollars are getting invested.
If it’s old capital moving back in that means that new capital may get invested from experienced hands. Both signals growth.”
Tether’s market cap currently stands at over $66.3 billion. The supply had peaked at $83 billion in May this year before spiraling downward and shrinking by over 20%.
Tether’s Declining Dominance
Once dominating almost 90% of the market, Tether’s share has dropped considerably over the past few years. It was now around 45%. This year’s downfall has helped the stablecoin market to command a larger share in addition to boosting Tether rivals’ circulation as well. As USDT shrunk, Circle’s USD Coin (USDC) gained prominence.
Binance USD (BUSD), the third-largest stablecoin, has also managed to ramp up its market share by 7.5x over the past couple of years. As reported earlier, a potential regulatory action against one stablecoin will not topple the entire system down as previously feared.
A growing stablecoin market also indicates that a significant portion of fiat money is still waiting on the sidelines. This was asserted by Binance CEO, CZ who went on to say that investors wouldn’t necessarily hold stablecoins if they wanted to get out of crypto.