There are a number of stable coins on the Ethereum blockchain (ETH). On January 29, Messari researcher Ryan Watkins stated that the stable coin denomination transfer issued in the ETH chain recently reversed the number of transactions with native ether. Essentially, Ethereum’s value transfer now consists mainly of stable coins such as Tether, Pax, and Dai.
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Researcher: “Ethereum’s economy is now dominated by stable value transfer”
On Wednesday, Messari analyst Ryan Watkins reported on the Ethereum blockchain and how the ETH economy is now dominated by stablecoins. The ETH chain has a large number of stable coins such as TUSD, USDT, DAI, PAX and GUSD. All five stablecoins use the ETH chain for stable value transfers. “The stablecoin transfer value has now turned the ETH on Ethereum,” tweeted Watkins. While Watkins shared another chart, he stated that most of the story was consumed by the transition from Tether (USDT) to Ethereum last year. Watkins believes the flippening took place in mid-2019, stressing that since then “the Ethereum economy has now been dominated by a stable transfer of value”.
In the last week of August 2019 news.Bitcoin.com reported on the significant migration of Tether from the Omni Layer network to Ethereum. At this point, ERC20 tether transactions flipped their omni equivalent. The Stablecoin Tether is a $ 4.6 billion network, and all coins are issued and serviced in chains such as BTC (Omni), ETH (ERC20), EOS, and Tron. After the significant changeover to the ERC20 standard, a large part of the USDT in circulation comes from the ETH chain. In addition, researchers have found that 70% of circulatory tether supply is controlled by approximately 104 addresses. After Watkins’ tweet about stable coins turning the ether of the chain, Binance founder Changpeng Zhao (CZ) commented on the topic.
“A lot of us (early adopters) don’t like stablecoins,” tweeted CZ. “But [the] The fact is, it is needed to bridge the gap as most new crypto folks will still think in the fiat base for a while. I wish it wasn’t, but we live on earth, not in a utopia. “
One person disagreed with CZ, saying that certain stablecoins will likely remove revenue from trading platforms. “Very hypocritical – I totally agree with you on centralized stablecoins like Paxos – Binance USD or USDC,” the person wrote. “[But] How about crypto-backed ones like DAI? The truth is that [decentralized finance] Apps like Uniswap, [and] Makerdao is taking a lot of revenue away from exchanges like Binance, ”he added. However, the Binance founder said he was not concerned about this situation and stated:
The more choices for users and the more innovations for the industry, the better for all of us. Don’t worry about Binance, we will make it – we are adaptable.
Stable coins and exchange tokens outperform the 2017-2018 ICO tokens that used Ethereum’s ERC20 standard
Another proponent of crypto agreed with CZ’s assessment, saying, “This is how new technologies and ideas are usually adopted. Today’s generation needs one foot on the old and one on the new at the same time in order to feel safe and to become familiar with their new surroundings. “Of the five stable coins maintained in the ETH chain, the USDT is by far the most dominant. This is followed by the USDC from Circle, the DAI from Makerdao, the PAX from Pax Global, the True USD (TUSD) and the GUSD from Gemini.
@RyanWatkins_ reported today that the transfer value of stablecoins to Ethereum has exceeded that of $ ETH. Token transfers as a whole were more common in Ethereum than non-token transfers. These are both signs that ETH has more utility than currency. pic.twitter.com/cAt4hfqBLU
– Christine Kim (@christine_dkim) January 29, 2020
At the time of publication, 2.29 billion USDT are represented by ERC20 tokens, and there are 439 million USDC tokens in the ETH chain. In addition to the overall stable coin value held on Ethereum, a large number of barter tokens use the chain. For example, barter tokens like BNB, LEO, HT, CRO, OKB, and KCS only scratch the surface when it comes to exchanging coins hosted on the ETH chain. Stable coins and exchangeable tokens are by far the most widely used ERC20 today, outperforming most of the ERC20 issued in 2017-2018 with the first coin offering (ICO). Observers such as Watkins and others have asked whether “it is good for ETH or damages ETH’s cash bonus”. Watkins discusses this topic in his latest research analysis, which will be posted on the Messari website.
What do you think of stablecoins flipping ethers in the Ethereum chain? What do you think of the number of stablecoins and exchange tokens that use the ERC20 standard? Let us know what you think on this matter in the comments section below.
Disclaimer: This article is for informational purposes only. It is not an offer or a solicitation of an offer to buy or sell, or a recommendation, approval or sponsorship of products, services, stable coins or companies. Neither the company nor the author are directly or indirectly responsible for any damage or loss caused or allegedly caused by or in connection with the use or reliance on any content, goods or services mentioned in this article.
Photo credit: Shutterstock, Twitter, Messari analyst Ryan Watkins, Fair Use, and Pixabay.
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