The total amount of tether (USDT) in circulation has soared this week as demand for cryptocurrencies rises amid an all-time high.
Better weather, more leash
Tether USD (USDT) in circulation is valued at just under $ 36 billion, having increased over 100% this year alone. The rapid increase in USDT supply exactly follows the price of Bitcoin (BTC) over the same period.
On January 1, the total value of USDT circulating in this space was just under $ 18 billion, less than half of its current value.
However, when Bitcoin hit a new all-time high and exceeded the $ 50,000 mark, USDT saw tremendous demand, often deviating positively from the USD value.
Historically, the increased demand for cryptocurrencies has resulted in Tether minting more and more USDT, which leads to inflation of the circulating supply. Essentially, this is what the market is seeing this year.
In addition, optimism in the cryptocurrency market is higher than ever, leading to increased demand for stable coins to buy cryptocurrencies.
The new ETFs are stable coins
Indeed, the overall stable coin market is seeing immense growth in both valuation and the number of options available.
USDcoin’s USDC also saw a similar pattern of growth as USDT. After starting the year with less than $ 2 billion worth of USDC in circulation, the stablecoin now has a valuation of just under $ 9 billion.
Due to its market capitalization, it is the twelfth largest cryptocurrency by this metric, just above Uniswap (UNI) and Dogecoin (DOGE). Additionally, USDC recently announced the expansion of its platform to Solana (SOL) to improve user experience.
Accordingly, new stablecoin platforms such as Venus (XVS) are also seeing a rapid increase in the number of users on their platforms. This year alone, XVS’s domestic governance mark has increased more than tenfold.
Is the Market Bullish?
With the increase in the stable supply of coins like Tether, there is now additional liquidity in the cryptocurrency market and it is used to buy cryptocurrencies.
This adds to the already growing demand that the market is seeing overall due to the all-time highs.
There is also a serious problem with making cryptocurrencies available on exchanges as miners choose to “hodel” rather than sell. In addition, institutions like Grayscale and MicroStrategy devour the remaining supply.
Combine these two factors and the cryptocurrency market may only be moving in one clear direction. to the moon.
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