The stablecoin Tether (USDT) is experiencing increasing dominance. This means that the project is experiencing an increase in its market share and influence in the crypto markets. JPMorgan bank is concerned about this increase. According to the bank, the developments could have a negative impact on stablecoins and the crypto ecosystem in general.
The total value of all USDT combined is almost $100 billion. The dominance comes as Tether has grown significantly both on centralized trading platforms and within decentralized finance (DeFi) protocols. The company behind the stablecoin even announced that it made a huge profit of $2.85 billion in the last three months.
Opportunities for other stablecoins
The World Bank says Tether poses risks due to a lack of regulatory compliance and transparency. This puts the stablecoin at risk of being targeted by regulators in different countries or regions. This could lead to investigations, fines, or even restrictions on Tether trading.
While Tether could run into trouble if countries impose stricter requirements, on the other hand, this presents opportunities for other stablecoins. Especially for projects that are more in line with existing regulations. These coins can benefit from any regulatory measures and gain market share.
Spain is testing Euro stablecoin
In the meantime, we are also working intensively on new stablecoins. Spain, for example, is starting to test EURM, a stablecoin backed one-to-one by the euro. The project is being implemented under the leadership of the fintech company Monei and under the supervision of the Bank of Spain.
The initiative aims to digitize payments and promises safer and cheaper transactions with fees as low as fractions of a cent. The focus of the pilot is on applicability for both consumers and businesses, with fast processing times and automatic payment options.
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