Tether (USDT), the number one stablecoin seems to be getting stronger. This is despite the increasing number of stablecoins in the cryptocurrency space. This is according to the CryptoRank.io dominance ranking since the year 2019. The data reveals that USDT dominance has increased from 72.2% to 82.5% within the year.
The increased dominance is in spite of the increasing number of new stablecoins which should have reduced USDT’s dominance. Several new stablecoins were created in 2019 including Binance USD, Paxos (PAX), and so on. USDT, however, seems to have defied the influx and is pushing its way up. In 2019, it emerged as the most traded cryptocurrency especially in Asia where there is a ban on Bitcoin, but cryptocurrency traders are allowed to buy the stablecoin.
Dominance for some other stablecoins did drop though. For instance, USDC which came second in dominance decreased from 11.6% to 7.9% while PAX which came third dropped from 4.9% to 3.7%. The market cap for the analyzed stablecoins including USDC, PAX, Single Collateral DAI, Double Collateral DAI, True USD, and Binance USD, increased by 101% in the year.
Stablecoins are becoming more popular among cryptocurrency users globally. This is mainly because they are easier to use for payment at merchants as their values are not as volatile as conventional cryptocurrencies such as Bitcoin or Ethereum.
2019 was said to be the year of stablecoins because of this growing popularity, but according to Crypto Rank, 2020 will be explosive for stablecoins because of the increasing desire to launch independent digital assets by institutions. This includes countries like China which is working on its own national digital currency that is likely to launch this year.
Facebook has strived to launch Libra, a stablecoin to be used for payments. However, the project has faced a lot of resistance from U.S lawmakers. If the same resistance confronts every attempt to launch a stablecoin, the year may not be so explosive.
However, the U.S may relax its laws as it has been cautioned to embrace a digital economy or its rival, China may outshine it in the nearest future as the global leader in digital technology.