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Bitcoin is the most popular crypto asset in the world, and it is widely associated with the word cryptocurrency.
The coin holds the majority of cryptocurrencies’ market share value, and it is at the forefront of conversations about the asset class.
This year has seen a surge in Bitcoin’s price, which has seen several traders enter the crypto trading market.
Tether experiencing higher trading volumes in comparison to Bitcoin
The nature of cryptocurrencies and the exchanges on which these assets are available makes it difficult for accurate data to be gathered about their trading volumes.
The figures that are available lack accuracy, but they provide a fair assessment of the status of crypto assets on the various exchanges.
CoinMarketCap is one of the most trusted sources of crypto data, and the platform provides industry stakeholders with a wide range of statistics.
Data from the platform reveals that although Bitcoin may be the most popular crypto asset, it does not have the highest trading volumes on a daily or monthly basis.
Tether, a cryptocurrency whose market capitalization is over 30 times smaller than that of Bitcoin, has the highest daily and monthly trading volumes among cryptocurrencies listed on exchanges around the world.
Tether’s trading volumes first surpassed those of Bitcoin in April, and the cryptocurrency has continued to rise since then. Tether is currently experiencing 18% more trading volume than Bitcoin.
The high trading volumes make Tether the most vital crypto asset in the industry, and several regulators are developing their policies with this asset in mind.
There are concerns that it is susceptible to manipulation and this could affect crypto markets as a whole.
Lex Solokin, co-head of global financial technology at ConsenSys, said that if Tether ceases to exist, they would lose a high amount of daily volume.
They could lose close to $1 billion worth of trading volume he added. ConsenSys offers its clients various blockchain based services, and the firm believes that if Tether disappears, it could lead to the falling away of some patterns of trading.
Most used stablecoin
Stablecoins are tokens that make use of reserves or pegs to avoid price fluctuations.
Many first-time crypto traders engage with stablecoins which are easy to use, even in jurisdictions where crypto trading is largely banned.
Tether is widely used in Asia, a region that accounts for 70% of the world’s total trading volume. Many crypto traders buy Tether then use the stablecoin to purchase other top crypto assets such as Bitcoin.
Data from Huobi and Binance, two top exchanges, shows that Tether was used in 80% and 40% of the transactions made on those exchanges.
The stablecoin provides a lot of convenience for crypto traders and exchanges alike.
Most crypto exchanges do not use bank accounts due to regulatory issues and they use Tether as the medium to hold their funds.
Thaddeus Dryja of the Massachusetts Institute of Technology said that many people do not realize that they use Tether when they engage in crypto trading.
Many traders think that their funds are in the form of fiat currency held in bank accounts yet the exchanges use Tether.
Some exchanges misrepresent the fact that they use Tether and let their clients believe that funds are held in dollars.