Tether has never been more popular. A quick look at Coinmarketcap’s data underscores this point, with 24-hour trading volume in USDT (US dollar-denominated Tether) that crosses both Bitcoin and Ethereum together.
Users of the Legacy Stablecoin show no sign of giving in
A slow-moving lawsuit filed by the New York Attorney General against Tether parent company iFinex for fraud and market manipulation, among a host of other criticisms, doesn’t even come close to defusing traders’ interest in the most popular stablecoin.
Competition is growing legs
While there are of course competing stablecoins, none have managed to meaningfully slow Tether’s momentum. Take Circle, which issues the competing USD coin. In addition to the monthly reserve certificates from the accountancy firm Grant Thornton, it has a more transparent issuing process.
But even with this enhanced protection and a 10X increase in inflows over the past 12 months, the capitalization is just over 20% of Tether’s total. Additionally, USDC’s 24-hour sales are a comparably pittance, hovering around $ 2 billion from Tether’s volume, which was regularly exceeded $ 100 billion a day.
These numbers point to Tether’s staggering role in the liquidity of the cryptocurrency market. The users are savvy, which is reflected by recent data showing how traders are increasingly using Tether released by Tron versus Tether released by ERC-20.
Usage shows no signs of slowing down
That is interesting Tron has been at the forefront of Tether transactions given its more competitive fee structure. Since the beginning of 2021, Tron has processed more Tether transactions than Ethereum on a daily basis, reflecting its more affordable fee structure at a time when Ethereum’s rapid price rise has consequently increased the transaction costs together.
While Tether’s dollar volumes processed by Ethereum more than double Tron’s smaller volume transactions, Tron users can seamlessly move Tether across the network for fractions of a cent compared to Ethereum’s costs, which rose more than $ 6 per transaction momentarily.
This development could lead to more steps from Tether to expand to other chains to keep transaction costs in line with more affordable chains such as Tron. Still, DeFi’s magnetizing pull may make Ethereum’s relative dominance too great to challenge.
Do you see a future for stablecoins in general and Tether in particular? Tell us what you think in the comments section below.
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