The world’s largest stablecoin, Tether (USDT), has expanded its circulating supply after a nearly three-month drop in what could be a sign that the crypto market is slowly recovering.
According to CoinMarketCap, the first mint in nearly three months occurred on July 29, followed by three more, most recently on August 2. However, the USDT injection was small, increasing Tether’s market cap by only 0.7% or just under $500 million.
Transparency according to Tether Report, now has $66.3 billion in circulation. This puts the total market share of stablecoins at around 43%.
Tether supply hit an all-time high in early May at $83 billion. The collapse of Terra’s ecosystem, resulting cryptocurrency contagion and mass redemptions forced the company to reduce circulating supply, which fell 21% to a low of 65.8 billion at the end of July.
This has allowed rival firm Circle to increase the market share of its stablecoin USDC, which now holds a 36% share with a market cap of $54.5 billion. As Cointelegraph reported last month, USDC trading volume on Ethereum actually flipped Tether’s volume for a while as the second-ranked stablecoin continued to catch up.
Last weekend, Binance CEO Changpeng Zhao Comment Regarding the number of stablecoins ready to re-enter the market, it is stated:
“Three of the top 10 are stablecoins, which means there is a lot of ‘fiat’ sitting on the sidelines, ready to re-enter. If people want to get out of cryptocurrencies, most people won’t hold stablecoins.
Stablecoins now account for 13.6% of the entire cryptocurrency market cap, near an all-time high
related: Circle’s USDC on track to overthrow Tether USDT as top stablecoin in 2022
A cost-of-living crisis caused by surging global inflation could hamper crypto investments and speculation among retail traders. However, those living in countries with extremely high inflation, such as Argentina, have insisted on using dollar-pegged stablecoins to hedge their national currencies.
Tether acknowledged the benefits of holding stablecoins, saying USDT “allows Argentines to access a truly globalized market and frees them from the local black market,” adding that it also “empowers them to hold in a way that the government cannot confiscate.” There is Tether, not like a local bank account.”