The total value of assets for all stablecoins in the market has gone past the $10 billion mark on Tuesday this week. The massive surge in value, more than 70% increase, managed to happen in the span of only two months’ time. This comes according to Coin Metrics, a data aggregator for the crypto industry.
The growth in stablecoin supply is as a result of more crypto traders choosing to trade in other forms of crypto besides Bitcoin, commonly referred to as altcoins. They typically do so via dollar-backed digital tokens as opposed to Bitcoin due to its relative stability compared to the grandfather of crypto assets.
Tether Leading The Charge
An important thing to note is the majority of this growth in stablecoins comes from Tether, which in and of itself represents an incredible 90% of the entirety of USD-backed stablecoins. The largest markets for Tether, measured by traded volumes, are supported through two of the global heavyweight exchanges based in Asia: Huobi and Binance. This information comes from CoinGecko, another crypto data provider. Both Huobi and Binance hold support for almost 200 different forms of cryptocurrency, which makes them key platforms for traders doing business in altcoins.
It’s almost expected nowadays that exchanges offer a Bitcoin trader a choice as to how they should trade assets, via USD or BTC, which will give them a different quote on said currencies. As one would imagine, the prices are different depending on what you use to trade for these other forms of crypto.
Historically speaking, altcoin traders preferred to use Bitcoin or Ether as a currency to trade for other tokens. However, this trend has taken a significant shift through these past two years, with most trades now being done through the reliable form of stablecoins, instead.
Less ETH And BTC, More Stablecoins
The growth in the amount of trading done through stablecoin, in turn, runs alongside the overall development of the total trading volumes of altcoins in general. This data was provided by yet another crypto data provider: Nomics. It should be noted that, while stablecoin trading of altcoins have been rising, the trading of altcoins with BTC and ETH have stayed below the volume highs that were made back in late 2017
As one would imagine, the key selling point for stablecoins is its namesake stability. Bitcoin Profit is a powerful asset to make money from, but its inherent volatility makes it incredibly unreliable as a form of currency.