By
Steve Muchoki
April 19th, 2024
Owing to growing concerns of Tether’s suspicious operations, cryptocurrency exchanges are considering to adopt other secure stablecoin offerings.
Hong Kong-based cryptocurrency exchange OKEx said that it will be adding support to trade four new stablecoins pegged to the U.S. Dollar. The exchange made this announcement in an official support notice rolled out today. Furthermore, the exchange noted that it will start rolling out the new additions from Monday and Tuesday.
The four new stablecoins which OKEx plans to list include TrustToken’s TrueUSD (TUSD), Circle’s USDCoin (USDC), the Gemini Dollar (GUSD), and the Paxos Standard Token (PAX). The TrueUSD (TUSD) Trust token was launched earlier this year in March while the other three were released just last month in September. Note that all of these stablecoins are pegged to the U.S. Dollar in 1:1 ratio.
Interesting thing is that the Gemini Dollar (GUSD), and the Paxos Standard Token (PAX) are both regulated stablecoins. Both these stablecoins are approved by the New York Department of Financial Services (NYDFS).
Growing Demand for Stablecoins
With the growing reports about the institutional entry in the crypto space, a number of cryptocurrency firms have doubled-down on their stablecoin projects. Stablecoins being tied to fiat currencies, their value remains same as the market value of the fiat at any given time. Furthermore, stablecoins helps to source instant liquidity in the crypto market.
Crypto investors can keep stablecoins stored in their wallets without the need to undergo fiat-to-crypto conversions, and vice-versa, every time. This proves to be very convenient especially for traders who want to make quick traders in the market. Stablecoins help to instantly pump liquidity in the crypto market. As more institutional players plan to join the digital currency market, the number of stablecoins in circulation will also continue to grow. Identifying this potential opportunity, crypto firms are rushing to release their own stablecoins.
During the launch of Circle’s stablecoin USDC (USD Coin), company founder Jeremy Allaire said:
“Market infrastructure like stablecoins will become the base layer that supports every financial application. It has to be legitimate, trustworthy, built on open standards. We are solving a lot of these fundamental problems that exist.”
Tether’s Loss Is Others Gain
Tether has been one of the most successful stablecoin projects so far. But the stablecoin has been embroiled in controversy for its alleged involvement with Bitfinex exchange to artificially pump the price of Bitcoin. Owing to the transparency issues, investors are now trying to distance itself from Tether usage.
This, in turn, has proved to be beneficial for other stablecoin projects. Moreover, regulated stablecoin tokens which function under the regulatory body’s observation are likely to gain more importance.
It would be interesting to see the shift in the stablecoin landscape taking place in the crypto market.