-
Stablecoin
market
cap
expanded
for
the
first
time
since
May
2022,
with
Tether’s
USDT
being
the
main
beneficiary,
rising
to
an
all-time
high
supply
of
nearly
$90
billion. -
The
trend
reversal
is
a
sign
of
improving
liquidity
in
the
crypto
market
as
more
capital
enters
the
ecosystem,
analysts
said.
Fresh
money
is
entering
cryptocurrencies
as
the
stablecoin
market
is
expanding
for
the
first
time
in
more
than
18
months,
highlighted
by
Tether’s
USDT
rising
to
an
all-time
high
market
cap
of
$89
billion.
Glassnode
data
shows
that
the
combined
market
capitalization
of
the
largest
stablecoins
increased
by
almost
$5
billion
over
the
past
month
to
$124
billion.
The
expansion
represents
a
major
trend
reversal
from
a
sustained
downtrend
that
started
in
May
2022,
roughly
coinciding
with
the
beginning
of
the
grueling
crypto
winter.
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Stablecoin
market
cap
saw
growth
for
the
first
time
in
18
months
(Glassnode)
Stablecoins
are
token
versions
of
cash,
serving
as
a
crucial
plumbing
of
the
crypto
ecosystem,
bridging
traditional
(fiat)
money
and
blockchain-based
digital
asset
markets
and
providing
market
participants
with
liquidity
for
trading
and
lending.
Thus,
the
trend
reversal
in
the
stablecoin
market
size
is
a
bullish
signal
for
the
overall
health
of
the
recent
crypto
rally.
“This
upward
trend
can
be
interpreted
as
a
leading
indicator
of
improving
liquidity
on-chain,
suggesting
an
environment
where
more
capital
is
available
for
deployment,”
Tanay
Ved,
analyst
at
Coin
Metrics,
said
in
a
market
report
Tuesday.
Tether
supply
rises
to
all-time
highs
Most
of
the
expansion
comes
from
Tether
(USDT),
the
largest
stablecoin
by
market
cap
and
mostly
used
on
centralized
exchanges
and
for
transactions
in
the
developing
world.
Its
supply
has
increased
by
$7
billion
since
September,
Matrixport
noted
in
a
Monday
report,
with
minting
picking
up
“in
a
meaningful
way”
since
mid-October.
:format(webp)/cloudfront-us-east-1.images.arcpublishing.com/coindesk/KLC2Z25YGRHBFNOOOTM27ZVUTQ.png)
Tether
USDT
minting
shows
increased
demand
for
the
token
since
mid-October
(Matrixport)
Actually,
USDT’s
market
cap
has
grown
has
been
growing
through
most
of
2023
and
is
now
nearing
$90
billion,
above
its
all-time
high
in
2022,
CoinGecko
data
shows.
But
the
contraction
of
competitors
such
as
USDC
and
BUSD
had
offset
USDT’s
growth
until
recently.
“The
trend
seems
to
be
up,
which
should
be
bullish
for
crypto
assets
as
it
signals
growing
investor
interest,”
said
Noelle
Acheson,
analyst
and
author
of
the
Crypto
Is
Macro
Now
newsletter.
“It’s
still
early
as
the
total
stablecoin
market
cap
is
still
well
below
levels
from
earlier
this
year,
when
the
outlook
was
arguably
much
worse
than
it
is
today,”
she
added.
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