Stablecoins have served as a bridge between cryptocurrencies and traditional markets. Perhaps, for this reason, it is that their popularity in the world of trading has been steadily increasing since their emergence.
Of all the current stablecoins, Tether (USDT) is the most famous. Its use to “freeze” funds has made it popular among users, in addition to being a pair as famous for price determination as Bitcoin.
A study published by the famous crypto company “Blockchain.com” formerly known as Blockhain.info concluded that Tether (USDT) dominates the crypto market in spite of all the questions raised by accusations of its lack of underlying value.
“Tether is the second most actively traded cryptocurrency, equal to approximately 60% of BTC daily trading volume. Earlier this year Tether entered the top-10 crypto asset rankings by market value, and it currently comprises 93% of the total market value of all stablecoins. Even with the success of new entrants like TrueUSD in gaining listings on major exchanges, Tether continues to dominate and commands approximately 98-99% of all stablecoin trading volume.”
Tether (USDT): Low Trust, High Adoption
It is important to point out that the value of stablecoins, unlike other cryptos, does not lie so much in the confidence of the users. Their raison d’être is the fact that they represent a token backed by a physical good or verifiable value.
Despite the apparent dominance of USDT, the study comments that the level of transparency of this cryptocurrency is “low”, but its main strength lies in the strong level of adoption by the most important exchanges worldwide. Its domain was consolidated in 2017 when Poloniex adopted it as a trading pair:
“Tether dominates the current stablecoin landscape. It is the most widely adopted stablecoin and is used by many industry-leading exchanges such as ShapeShift, Bittrex, Bitfinex, Binance, and Poloniex. It has proven particularly attractive to significant exchanges that do not offer US dollar customer accounts. For example, in 2017 Tether experienced a rapid increase in volume on Poloniex, arguably playing a pivotal role in it becoming the market leading exchange by volume in mid-2017.”
Tether (USDT) is currently ranked 8th in the global market cap. Its total capitalization is around 2.8 Billion Dollars. The nearest fiat-backed stablecoin is True USD (TUSD) occupying the 65th place with a capitalization of almost 103 Million dollars.
