The total amount of Tether (USDT) in circulation has soared this week, as demand for cryptocurrencies surges amidst all-time highs all-round.
Better Weather, More Tether
The circulating of Tether USD (USDT) has a valuation of just under $36 billion, after soaring over 100% this year alone. The meteoric rise in USDT’s supply closely tracks the price of Bitcoin (BTC) over the same period.
On Jan. 1, the total value of USDT circulating in the space was just under $18 billion, less than half of the current value.
However, as Bitcoin hit a new all-time high, breaking over the $50,000 mark, USDT began seeing huge demand, often diverging positively from USD’s value.
Moreover, optimism in the cryptocurrency market is at the highest ever, translating into more demand for stablecoins to buy cryptocurrencies.
Stablecoins Are The New ETFs
USDcoin’s USDC also saw a similar pattern of growth to USDT. Having started the year with less than $2 billion worth of USDC in circulation, the stablecoin now has a valuation of just under $9 billion.
Its market capitalization makes it the twelfth largest cryptocurrency by that metric, just above Uniswap (UNI) and Dogecoin (DOGE). Moreover, USDC recently announced its platform’s expansion to Solana (SOL) to increase its usability.
Accordingly, new stablecoin platforms like Venus (XVS) are also seeing rapid surges in the number of users on their platforms. XVS’s native governance token rose more than ten-fold this year alone.
Is The Market Bullish?
With the increase of stablecoin supply, like Tether, there is now extra liquidity in the cryptocurrency market and will be used to purchase cryptocurrencies.
This adds to the already bulging demand the market is seeing as a result of all-time highs all-round.
There is also a serious cryptocurrency supply issue on exchanges as miners choose to ‘hodl’ instead of sell. Moreover, institutions like Grayscale and MicroStrategy are gobbling up whatever supply is left.
Combine these two factors, and the cryptocurrency market may only be heading in one clear direction; to the moon.
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