Excellent John K. Kumi is a cryptocurrency and fintech enthusiast, operations manager of a fintech platform, writer, researcher, and a huge fan of creative writing. With an Economics background, he finds much interest in the invisible factors that causes price change in anything measured with valuation. He has been in the crypto/blockchain space in the last five (5) years. He mostly watches football highlights and movies in his free time.
Tether (USDT) staged an unprecedented run in the last 30 days to a 20% increase in volume to reach the cumulative transaction volume of the stated amount.
Tether (USDT) has emerged as one of the most engaging digital currencies recording a cumulative transaction volume of over $600 billion, putting it in a better position to rub shoulders with Bitcoin. Tether (USDT) staged an unprecedented run in the last 30 days to record a 20% increase in volume to reach the cumulative transaction volume of the stated amount.
The positive run of Tether (USDT) does not end in its cumulative transaction volume, but also, its circulation. The digital asset has tripled its circulation from 4 billion at the beginning of the year to a current figure of near 16 billion.
According to CoinMarketCap and Coingecko, Tether has an average daily transaction volume of around $35 billion ahead of the $20 and $25 billion average transaction volume of Bitcoin. A critical examination of the metrics reveals that the world’s most popular stablecoins have commanded massive control over the market. According to the reports, more than 70% of the trade volumes on the various exchanges were all about USDT pairs. This is a massive improvement compared to the 2017 statistics where Tether (USDT) only contributed a smaller percentage to the total trade volume with Bitcoin recording over 50% of the share.
The CTO of Tether (USDT) Paolo Ardoino commented on the recent performance, stating that Tether (USDT) has proven to be one of the best-trusted assets in the cryptocurrency industry. The Bloomberg’s Crypto Outlook Report for the 4th Quarter of 2020 captured an interesting prediction on Tether (USDT) overtaking Ethereum to become the second most ranked coin by market capitalization. Having cited the steady rise of the Tether (USDT) market cap from 2017 with just one massive dip in 2018, the report revealed that Tether will displace Ethereum from its current position by 2021.
According to Skew, an analytics provider, the futures contracts based on Tether (USDT) are currently rubbing shoulders with BTC margined contracts daily. The likes of USDC, TUSD, PAX, and others have experienced their fair share of the rise.
Some Possible Reasons for Tether (USDT) Growth
Because the growth accelerated so much in 2020, it is safe to link its reason to the global pandemic. The introduction of relief packages such as FED inducing close to $6 trillion to prevent economic regression and to help citizens recover from the impact of the virus has had a positive effect on stablecoins.
Also, the fear that various risky cryptos may crash due to the global pandemic caused investors to convert those assets to a USD pegged stablecoin or fiat. Other analysts also associate the growth of stablecoins to the ongoing court case with the New York Attorney General on the decision to back digital dollars. The adoption rate of stablecoins has been spectacular in recent times with the rate expected to increase as governments are exploring the possibilities of adopting Central Bank Digital Currencies.