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Stablecoins Availability Has Increased By 388% This Year.

As per statistics provided by The Block Research, the market for stablecoins enjoyed fast expansion in 2021, with the quantity of dollar-backed cryptocurrencies increasing by 388 percent.

According to The Block Research’s 2022 Digital Asset Outlook study, the total supply of stablecoins has risen from $29 billion at the beginning of 2021 to further than $140 billion. This expansion benefitted a wide range of stablecoins, notably tether (USDT) and USD Coin (USDC), which are administered by a consortium that comprises Circle and Coinbase.

Multiple causes led to the increase in the authorized quantity of stablecoins, which have typically been utilized as a tool to decrease volatility when trading between different cryptocurrencies by high-speed crypto trading businesses. Retail traders stored stablecoins on decentralized finance protocols in 2021 to take advantage of juicy yields.

A further positive factor was the expansion of the derivatives market. According to Tether’s Paolo Ardoino, most derivatives marketplaces pay futures contracts in stablecoins.

Nonetheless, according to The Block Research, the sector will face further scrutiny in 2021. While regulatory issues have previously dogged Tether, the whole market has fallen under scrutiny, with authorities querying the potential systemic danger such coins provide to the market and if they will be subjected to a much more explicit regulatory framework.

Thinking forward, Circle CEO Jeremy Allaire predicts that 2022 will be the year that corporations resort to stablecoins to enhance payments. He stated that more consumers and businesses desire to own stablecoin’, which is driving desire for them all across the globe.

 

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