• Tether USD (USDT) has seen a surge in dominance, reaching 57.8%.
• This was due to the regulatory crackdown on Binance USD (BUSD), as well as the chaos surrounding the USDC peg.
• The dominance of BUSD has decreased from 16% to 6.75%, while USDC remains within the 30-33% range.
Tether’s Dominance Surges
The recent market chaos has been highly beneficial for Tether (USDT), whose dominance over the stablecoin market has now reached 57.8%.
Analysis of Stablecoins‘ Supply Dominance
According to Glassnode’s weekly report, Tether had been facing structural decline since mid-2020 until recently, when its dominance began increasing. This trend is measured by what percentage of the total stablecoin supply is made up of any given token, and when this metric rises it means investors are likely rotating into that particular coin from other stables.
Decline in BUSD and USDC Dominance
The change in Tether’s supply dominance can be attributed mainly to two events: regulatory pressure on Binance USD (BUSD) and chaos surrounding the USD Coin (USDC) peg. As a result, BUSD’s share of the supply dropped from 16% in November 2022 to 6.75%, while USDC remains within its 30-33% range despite brief loss of its $1 peg due to fears regarding unbacking by Silicon Valley Bank (SVB).
Impact of these Events on Market Dynamics
These events have had a significant impact on market dynamics, with investors increasingly preferring Tether over other stables during this period of chaos and uncertainty. As such, it appears that Tether will remain at the top spot at least until things settle down and stability returns to the markets.
In conclusion, it appears that Tether is reaping the benefits of recent market events as its dominance continues rising steadily over other stablecoins in circulation today. With no signs of this trend reversing anytime soon, it looks like there could be more good news ahead for holders and users of USDT moving forward.