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Tether's Supply Dominance Hits Record Low as USDC & Co Rise

Tether's Supply Dominance Hits Record Low as USDC & Co Rise 101
Source: Adobe/Jim

As USD coin (USDC) strengthens its positions, tether (USDT) is losing its market share, according to crypto intelligence firm Coin Metrics. That said, stablecoins, in general, are again on the rise this year, and the total supply is expected to grow further with the increase in use cases.

Per the firm's weekly report, USDC is going parabolic - its total supply passed USDC 9bn on February 28, and this was only six days after surpassing USDC 8bn. All in all, USDC supply has more than doubled since the start of the year.

But while this is good for USDC, it means increased competition for USDT, with Coin Metrics writing,

As a result of USDC’s rapid rise Tether’s (USDT) supply dominance has dropped to 70%, its lowest level ever.

Tether's Supply Dominance Hits Record Low as USDC & Co Rise 102
Source: Coin Metrics

That said, stablecoins as a whole are seeing a comeback in 2021, rising yet again. They are widely used:

  • in decentralized finance (DeFi) as collateral and for other purposes;
  • to hold money on the sidelines amidst market volatility;
  • to trade in and out of bitcoin (BTC), ethereum (ETH), and other cryptoassets;
  • to move money around the world and for foreign aid.

Total stablecoin supply has increased to over 50bn, growing from about 30bn to start the year, wrote Coin Metrics, adding that,

As the use cases for stablecoins continue to grow, supply will likely keep on rising.

Furthermore, high activity is suggested by the number of stablecoin active addresses, which have surged along with supply. While stablecoins have averaged over 300,000 unique active addresses per day over most of February, stablecoin total active addresses surpassed 400,000 on February 18 - which is a new all-time high.

Meanwhile, as reported in early February, Coin Metrics noted a shift of tether activity from the Ethereum to the Tron (TRX) version. The number of USDT_TRX active addresses had eclipsed the number USDT_ETH active addresses since the beginning of 2021, they wrote, with the reason likely related to rising Ethereum fees.

Ranked fifth now, per Coinpaprika.com, tether's current market capitalization is USD 35.85bn. Per 24h volume, it ranks first with USD 76.09bn recorded on March 3 so far. Bitcoin is in second place, with USD 52.3bn. USDC currently (13:11 UTC) ranks 31st by market capitalization (USD 2.76bn), and 17th by volume (USD 1.03bn).
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Learn more:
- Stablecoins May 'Penetrate Non-Crypto Markets' & Surpass USD 100B in 2021
- Tether & Bitfinex Settle NY AG's Probe, Expect More Transparency
- Stablecoins Might Be Better Than Bitcoin For Payments, But Maybe Not For Long
- Imagine Regulators Shutting Tether Down - What Happens to Bitcoin?
- Zero Interest Rates Not The Only Driver For Stablecoin Demand
- Visa Makes Stablecoin Push With Circle’s USDC
- Stablecoins May Threaten EU Market Integration And Interoperability - ECB
- Bitcoin Strongest In North America, Asia More Open to Stablecoins, Altcoins
- Stablecoins Seen as Most Important Development in Crypto

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