Stablecoins – Which ones will thrive? Tether? TrueUSD? Paxos? USDC?
According to Diar, a weekly institutional digital currency and assets publication, stablecoins have found a lot of growth in the past few months. Especially as many different coins have come online.
For those who aren’t aware, a stable coin is a gateway cryptocurrency. It’s a cryptocurrency designed to minimize the effects of price volatility. It’s often pegged to another stable asset like gold or the US dollar, but they generally have the benefits of a cryptocurrency like decentralization and privacy, but with the stability of a fiat currency.
According to CoinMarketCap, Tether is currently the most popular stable coin in the market with a market capitalization of $1.8 billion as of December 11, 2018.
While Tether currently ranks as the fifth most popular cryptocurrency token in the market, they’ve faced a lot of issues concerning their lack of transparency, unclear audits and lack of public documents backing their USD reserve.
Tether’s dominance in the stablecoin market has however reached a new three year low. According to a report from The Block, Tether dominated 96% of the stablecoin market. However, due to competition from new players like Coinbase and Circle’s USDC, the True USD, the Paxos Standard, and the Gemini Dollar, Tether’s dominance currently sits at around 74%.
Diar Reported that the four major stable coins USDC, True USD, Paxos, and the Gemini Dollar had broken the $5 billion mark when it comes to blockchain transactions within a three-month time period.
There was also a significant increase in over 1,032% when it comes to stable coin blockchain transactions in November, compared to December. Stable coins have hit $2.3 billion market cap at the end of last month.
Paxos which raise over $93 million has also recorded more than $1,8 billion on the Ethereum blockchain alone in the last three months. This figure is extremely significant since it has doubled that of the USDC, the Coinbase and Circle backed stablecoin.
As you can see, 2018 has been the year of the stablecoin market. The bearish market has led to a large wave of stablecoin issuances, which have led to more than 50 stablecoins in the market. Coindesk believes that 2019 will be a big year for stablecoins moving forward.
Do you guys think it’s the rise of stablecoins?
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Disclaimer: Cryptopig content is written by a team of blockchain passionate people. We are not registered as investment advisors. Don’t take the information in this post as investment advice and make sure you do your own research before investing. Cryptocurrencies are a very risky investment, never invest more money than you can afford to lose.