Tether Sees Remarkable Growth In 2023; USDC Struggles to Keep Pace
Summary:
In 2023, Tether (USDT) saw a significant rise in market capitalization, gaining an extra $20 billion. Two main factors have driven this growth: market speculation surrounding a potential Bitcoin exchange-traded fund (ETF) and rising demand in emerging markets. Tether has become a trusted digital asset for communities facing a devaluation of their local currencies. Conversely, Circle’s USDC (USDC) has not achieved similar growth, losing about 45% of its market value in 2023.
The most significant stablecoin in terms of market capitalization, Tether (USDT), has consistently achieved new heights during 2023, with its market cap gaining an additional $20 billion thus far this year. As per the blockchain analytics provider Whale Alert, Tether has produced 22.75 billion USDT this year, including 4 billion USDT in the last month. Starting the year with an approximate market cap of $66 billion, Tether USDT has shown consistent growth and by April 2023, its market value exceeded $80 billion. On November 14, the market cap of USDT briefly touched $87 billion, as indicated by CoinGecko data.
Tether's spokesperson comments that the continuous USDT expansion is driven by two main factors, namely the buzzing market speculation surrounding the potential approval of a Bitcoin spot exchange-traded fund (ETF). The spokesperson said, "The likelihood of a Bitcoin ETF is driving an increased interest in Bitcoin among institutional investors."
Tether's record-setting growth is also driven by the escalating demand in nascent markets, says the company's spokesperson. The spokesperson mentions that USDT is getting increasingly recognized as a digital dollar in emerging markets and developing countries, and added, "Due to the devaluation of their local currencies against the dollar, communities in various countries are seeking protection... For them, USDT becomes the most reliable asset."
According to Tether's statement based on Brazil government's public data, 80% of Brazilian crypto transactions are in Tether USDT. "This trend is mirrored in dozens of other countries," the representative mentioned.
While Tether experiences this upsurge, other significant stablecoins like Circle’s USDC (USDC) have hardly seen any surge in popularity in 2023. Having reached its peak at $55 billion in June 2022, the market cap of USDC has slowly shrunk and continued its decline in 2023. From January 2023, USDC has lost $20 billion in market value, which is equivalent to about 45%. As per the CoinGecko data, the current market cap of USDC comes to $24 billion.
Published At
11/14/2023 1:28:30 PM
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