Research analysis from renowned on-chain analytics providers, Glassnode, has revealed that the top three stablecoins represent more than 90% of the sector’s entire market cap.
In line with today’s, Glassnode’s “Week On-chain” report, the top three stablecoins – Tether [USDT], USD Coin [USDC], and Binance USD [BUSD] – have seen significant growth over the past 6 months to represent a combined cap of over $60 Bln, adequate to 92.75% of the stablecoin market
Additionally, 6 months ago the combined stablecoin capitalization for those three was but one-third of its current levels at $19.2 Bln. At this point last year, stablecoins were worth just $7 Bln combined.
The analysis compared the expansion of stablecoins with Bitcoin’s market cap, identifying a transparent correlation between the two. The report also found that USDT’s supply has continued to extend during recent weeks despite BTC trending sideways, whereas growth for USDC as well as BUSD has slowed.
The report notes historic lows for its SSR [Stablecoin Supply Ratio] metric, which measures Bitcoin’s market cap relative to the entire stablecoin supply to estimate the worldwide “purchasing power” of the entire stablecoin sector.
When BTC prices are low, the availability of stablecoins can purchase a bigger portion of it to push prices up. Moreover, as prices hike the available stablecoins can buy less which reduces the influence on prices. Glassnode explains:
“The growth of stablecoin supplies throughout 2020-21 has held the SSR metric near historical lows suggesting a comparatively high purchasing power of digitally native dollars. The demand for digital dollars appears to be keeping pace with demand for Bitcoin and cryptocurrencies as an entire.”
Tether’s market cap has over doubled since the starting of this year, to presently sit at a record $45.6 Bln, consistent with the Tether transparency report. Circle’s website reported an all-time high of $11.5 Bln USDC on 9th April, while Goingecko estimated BUSD’s supply to be $5.1 Bln on 13th April.
Earlier on 7th April, Circle CEO Jeremy Allaire predicted its USDC stablecoin could soon surpass PayPal by settlement value.