2023-11-06 05:02:49
Since the beginning of the year, the market for stablecoins has changed significantly. The two leading stablecoins, Tether USDT and USDC, have taken completely different paths in a market still reeling from last year’s Terra UST crash. Despite the turbulent environment, USDT’s dominance has expanded to such an extent in the recent period that its market capitalization has become almost 3.7 times that of the world’s second largest stablecoin, USDC. USDT vs USDC Looking at the change in market capitalization, we find that the trends of Tether (USDT) and USD Coin (USDC) have hardly differed over the past two years. By February 2022, both were on a fairly similar trajectory. But what happened next? In mid-March 2022, the growth of USDC stopped, while the growth of USDT continued. The first major drop came in May with the collapse of the Terra/Luna ecosystem and the UST stablecoin in particular. “The USDC has survived the battle, but it remains unclear whether it will win the war,” brokerage Enigma Securities wrote in its March report. The crash scared many stablecoin holders so much that USDT capitalization fell from $83 billion to $66 billion in regarding a month. At the same time as the decline, USDC rose, simply because many people switched to USD Coin instead of Tether. Things started to change the following month, when the USDC started the negative course it has been on since then and it looks like it might lose the “war”. It has now fallen as low as $24 billion, less than half of the $55 billion reached in June 2022. In contrast, USDT began a growth phase starting in February 2023 that is still ongoing. The growth is so strong that yesterday the value of USDT in circulation rose to a new all-time high of $85 billion. USDC holds its own better in the DeFi market However, the situation in the DeFi market is significantly different. A few years ago, USDC dominated the DeFi protocols, while today it has given way to Tether. However, on networks like Polygon, USDC continues to capitalize more; $534 million compared to USDT’s $472 million. However, these differences are negligible compared to Ethereum ETH PRICE, where USDT has a capitalization of $35 billion, while USDC has less than $20 billion. A big difference can be seen on the Tron network, where USDT has a capitalization of $45 billion, while USDC is only $0.4 billion. In addition, USDT dominates the Binance Smart Chain network, Arbitrum, Solana, Avalanche. Optimism, on the other hand, is led by the USDC. Considering the major DeFi networks, USD Coin dominates two networks, Polygon and Optimism, but USDT takes the lead in all others.
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