Tether bigger than ever, but volume at curious low

Where the crypto market has grown rapidly in recent months, stablecoins have not. Most of these coins have shrunk considerably. But that was not the case for Tethers USDT, this token grew nicely with the rest of crypto. Still, Kaiko is worried.

USDT achieved record in market value

In a weekly research report writes the blockchain analysis company that the market value of USDT has now reached a all time high has achieved. There are currently 82.9 billion USDT tokens in existence, slightly more than the 82.3 billion USDT that existed around the peak in May 2022.

Since the floor of USDT’s market value in November of 2022, the coin’s market value has grown by almost 30%. This makes it one of the few. Circle’s USD Coin (USDC) and Binance’s BUSD, the biggest competitors, are according to data from CoinGecko actually shrunk by 47% and 77% respectively. With that, USDT is now clearly the largest stablecoin. USDC is currently not really close at $ 29.4 billion.

Trading volume USDT finds strange low

But the record is somewhat strange, says Kaiko. Because USDT trading volume has not been as low as it is now since March of 2019. One explanation for this is regulation in the US. More than 50% of all trades are executed with USDT.

In particular, centralized exchanges that are less heavily regulated are responsible for this volume, and these appear to be the trading venues where much of the volume has moved. “Traders who normally use US dollars do not have this option (on alternative exchanges), so they have turned to USDT,” Kaiko researcher Clara Medalie wrote.

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On decentralized exchanges (DEXs), USDT accounts for only 20% of the volume, but the volume in this market is only a small part of the total.

Volume USDT no exception

However, not all USDT news is negative. Like this Strike has added the token as a payment option, which will help increase the volume of USDT. The liquidity in the crypto market has been since the banking crisis is not goodwhich is why the lack of volume on USDT is no exception.

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