As a seasoned researcher who has witnessed the crypto market’s rollercoaster ride for years now, I must say that the current surge of the stablecoin market cap to a new ATH is nothing short of fascinating. With my first job being in the industry during the days of Satoshi Nakamoto’s whitepaper, I never thought we would reach this point where stablecoins hold over $168 Billion in market capitalization.
In simple terms, the cryptocurrency market, worth over 2 trillion dollars, is home to millions of digital currencies, with values ranging from less than a dollar to hundreds. These digital coins come in many types, each different based on their properties, purposes, stability, and other factors. One specific type is known as stablecoins, which tie the value of cryptocurrency to assets like the US dollar or gold. Recently, this category has reached an all-time high (ATH), surpassing 168 billion dollars in market capitalization following a steady growth period for months.
Stablecoin Market Cap Surged To New ATH
According to DeDiLlama’s report, the total market capitalization of stablecoins has reached a brand-new record high of $168.125 billion. This surpasses its previous peak from March 2022, marking eleven consecutive months of growth in this sector.
In that period, the market capitalization peaked at a record $167 billion, but later plummeted by over $32 billion by the end of the year. Matters worsened, eventually hitting rock bottom in August 2023, with the value dipping below $121 billion. However, from that point, it began to gradually increase again.
Over the past period, the total value of stablecoins has consistently grown, reaching a record peak of $168.349 billion on August 25, 2024. Numerous financial experts, including Patrick Scott, view this as positive for the market, indicating an influx of fresh funds into the crypto sector.
And just like that, we’re at a new all-time high.
The total value of all stablecoins (excluding those that are algorithmically managed) has reached an all-time peak, exceeding its earlier record from the start of 2022.
New money is entering crypto.
— Patrick Scott | Dynamo DeFi (@Dynamo_Patrick) August 25, 2024
It’s been suggested that this could be a favorable moment for the price of Bitcoin to increase, given the enhanced liquidity in the market. At present, Bitcoin is being traded at approximately $63,700 and has slightly decreased from its peak of $64,879 yesterday, which doesn’t necessarily signal an immediate rise as a result of the new surge in dollar-backed tokens.
USDT Leads The Stablecoin Market
USDT (Tether) stands as the largest stablecoin currently available, boasting a market capitalization of around $117.9 billion and daily trading volume of approximately $39.2 billion. Given its status as a stablecoin, USDT’s value is linked to the U.S. dollar, keeping it almost equal in value. At present, one USDT is valued at $1, following an increment of 0.01% over the past 24 hours.
In over 70% of the stablecoin market, Tether stands victorious and has contributed significantly to this sector’s expansion. Furthermore, in just one year, the market capitalization of USDT has doubled from $82 Billion to an impressive $117 Billion. This tremendous growth is associated with Tether minting 3 billion USDT for circulation recently.
USDC, one of the largest dollar-backed cryptocurrencies, has seen similar growth. A year ago, its market capitalization was approximately $26 billion, but currently, it stands at about $37.4 billion. This substantial increase significantly boosts the overall Stablecoin market cap growth.
Final Thoughts
Over time, the importance of Tether and other dollar-backed cryptocurrencies has risen notably, as evident in the surge of the Stablecoin market cap. This sector recently reached an all-time high of $168.349 Billion after Tether minted approximately 3 billion USDT tokens over the past few days. This development significantly influenced the total capitalization due to Tether’s dominance of around 70% within this dollar-backed token category.
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2024-08-26 13:46