Tether (USDT), the most used stablecoin in the world, has just been surpassed by USD Coin (USDC) — at least in the total cryptocurrency offer on the Ethereum network.
As each token is paired with one dollar, the overshoot proves that today USDC is the largest stablecoin on the Ethereum network, with more than $40 billion in tokens on the network. At this rate, USDC is ahead of both centralized options, such as Tether itself, and decentralized options that are gaining strength in the space, such as DAI and UST.
USDC is operated by a consortium called the Center, whose main members are the companies Circle and Coinbase, which guarantee the backing of the stablecoin through dollar reserves in cash and other financial instruments.
Amidst the constant criticism that Tether suffers from the crypto community for the lack of transparency of its reserves, USDC has become an option for those who want to avoid USDT.
The current growth of the coin on the Ethereum network, however, may be associated with the increase in its use in decentralized finance (DeFi) and the volatility that has intensified in the crypto market in recent weeks.
“As the digital asset sector tends either up or down, both scenarios drive higher demand for USDC – especially during significant market moves,” a Circle spokesperson told the Associated Press. The Block.
That’s because when cryptocurrencies soar, investors look to stablecoins to facilitate trading on exchanges with something that represents fiat money. There is also demand in bear markets as users seek stability.
Although USDC has taken the lead on the Ethereum network, USDT remains the most used stablecoin in the entire market. Tether currently moves $56 billion daily, more than double the volume of Bitcoin, according to the report. CoinMarketCap.
USDC vs USDT
Both USDC and USDT are available on several other blockchains such as Solana, Algorand and Tron, and their strengths on each vary.
Part of this overtaking USDC on Ethereum was “allowed” by Tether, as the company has opted to issue its coins on other networks. Tron, for example, seems to be the favorite.
In August of last year, the amount of USDT issued on Tron surpassed Ethereum for the first time in history, but currently the stablecoin’s share in the two networks is more balanced. Ethereum is slightly ahead with an offer of 39.8 billion USDT versus 38.7 billion on Tron, according to data from the The Block Research.