Tether (USDT) hit a new market capitalization high of $90 billion in December 2023, commanding a 70% market share. Tron founder Justin Sun revealed that 17.2% of Tron users now hold USDT, indicating the growing use of stablecoins. The third French bank, Société Générale, is going to launch its own stablecoin, the EUR CoinVertible.
The first week of December 2023 marked a major milestone as Tether (USDT) reached a new market capitalization high, while its competitors saw their market capitalization decline.
This achievement positions Tether as a dominant force in the stablecoin market, with a staggering 70% market share. This increase in market capitalization reflects Tether’s growing influence. It also shows the increased acceptance and use of stablecoins in the digital economy.
Tether: USDT Still the Most Popular Stablecoin
This dominance is reinforced by the volumes traded. As Rob Hadick, general partner at Dragonfly, points out, “USDT volumes are nine times higher than USDC,” indicating that “these tokens are serving different use cases today.”
This disparity highlights the preference of traders outside of US/UK regulated firms and emerging markets for USDT as a transaction mechanism. In contrast, USDC is mainly used today to make secure holding for US-based companies.
Additionally, Tether’s dominance appears to be gaining ground among other major stablecoins. The recent rise in market capitalization to a new all-time high clearly indicates a divergence between the second largest stablecoin, USDC.
As of July 2023, Tether has seen a 36% increase in its market capitalization. However, USDC has seen its market cap fall below its July 2023 market cap of $27 billion, a 5-month low. Moreover, what was previously the third-largest BUSD stablecoin has lost appeal following its removal from Binance as a stablecoin. Allowing DAI and TrueUSD to surpass it.
Stablecoin: 17.2% of TRON Users Hold USDT, according to Justin Sun
Tether’s growing influence is also evident on the Tron platform. Commenting on Tron’s growth, Tron founder Justin Sun pointed out an impressive statistic:
“34,500,061 users on Tron, representing 17.2% of all our users, now hold #USDT.”
This not only marks a significant milestone for Tron. But it also attests to the growing use of USDT and other stablecoins in the market.
TRON (TRX) is currently the 12th largest cryptocurrency project by market cap. It is one of more than forty projects that currently use the popular stablecoin within their ecosystems.
Stablecoin Adoption Extends to Banks
The rise of stablecoins is not limited to Tether alone. In a pioneering move, France’s third largest bank, Société Générale, is about to launch its own stablecoin, the EUR CoinVertible. The stablecoin will launch on Bitstamp, an exchange based in Luxembourg.
It is the first time that a major bank has offered a wide range of investors digital tokens that track the price of hard currencies. Jean-Marc Stenger, CEO of SocGen Forge, the bank’s digital assets unit, referred to this adventure by stating the following:
“The cryptocurrency ecosystem is very concentrated on a few existing stablecoins, 90% denominated in US dollars… we definitely believe there is a place for a bank in this space and there is a place for a stablecoin [denominated] in euros.”
This step by Société Générale may pave the way for other traditional financial institutions to follow suit, which could lead to a more diversified stablecoin market.
The stablecoin market, currently valued at $130 billion, is largely dominated by Tether and the US-based Circle. Both have faced questions about audits of the reserves backing their tokens.
By Leonardo Perez
