The stablecoin tether has achieved a new market capitalization milestone, surpassing the previous year’s highest capitalization of $83.2 billion.
The numbers indicate that there is strong demand for stablecoins despite the frosty market.
Demand for rope remains strong
The company behind the most valuable stablecoin, Tether, has surpassed its previous record market valuation of $83.2 billion. It set the previous bull market record in May 2022. It continues to show increased demand for the asset while continuing to play it safe with regulators.
Tether CTO Paolo Arduino believes that the demand for tether stems from people’s desire for financial independence and the fact that it provides a safe haven for the unbanked.
If you want to learn more about Tether and other stablecoins in the crypto industry, be sure to check out our beginners guide here!
Meanwhile, Tether is trying to establish itself as a trusted entity in the cryptocurrency space.
It has strengthened its position since the beginning of the year. revealed a $1.48 billion net profit for the first quarter, which helped increase Tether reserves.
Stablecoin Market State
According to CoinGecko data, Tether’s market capitalization has increased by nearly 2% over the past 30 days. However, other major stablecoins, including USD Coin, Binance USD, DAI, and TrueUSD, saw losses at the same time. USDC’s market capitalization fell by 5% in the previous month, while BUSD fell by about 16%.
The total market capitalization of stablecoins has dropped significantly over the past 14 months by more than $50 billion, according to a previous report by BeInCrypto. The market capitalization is just over $130 billion, down from over $186 billion in May 2022. Tether, which currently has about 63.9% market share, is swimming against the tide.
It is worth noting that the decrease in the market value coincided with a decrease in the trading volume.
Regarding the performance of the stablecoin, Binance CEO Changpeng Zhao emphasized how Tether is benefiting from the BSUD downturn. The New York Department of Financial Services (NYDFS) implemented a cap on the total supply of BUSD at $23 billion before lowering it to $5 billion, according to chow.
Basically, Binance USD cannot mint new coins that exceed this limit. In contrast, USDT has seen a significant growth over this period.
Because USDT is exempt from the BUSD supply cap set by the NYDFS, its availability is more flexible. As a result, USDT expanded and met the growing demand for stablecoin transactions.
Meanwhile, the market as a whole is still expanding. Hong Kong-based First Digital has released a new stablecoin named FDUSD. This stablecoin uses the Binance Smart Chain (BNB) and is pegged to the US Dollar (USD).
Recently, Stably, a well-known stablecoin-as-a-service resource, announced plans to introduce USDStablecoin, a stablecoin backed by the US dollar, as a locally issued BRC20 token.
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