September 04, 2020 at 09:13AM
The rise of DeFi protocols and the demand for tokens in liquidity pools may be contributing to a huge surge in the supply of stablecoins. According to an Sept. 3 tweet from Coin Metrics co-founder Nic Carter, the current supply of stablecoins Binance USD (BUSD), Dai (DAI), HUSD, Paxos Standard Token (PAX), USD Coin (USDC), USDK, Tether (USDT), USDT_ETH, and USDT_TRX has been increasing by roughly $100 million daily for almost two months.
“Everyone got so excited about DeFi no one pointed out that stablecoins have been adding $100m/day since mid-July,” said Carter. “DeFi yields/interest rates are clearly a vacuum sucking in a lot of stablecoins.” Stablecoins are popular among the tokens used in liquidity pools for DeFi protocols which have been popping up in ever greater numbers this year, offering larger and larger yields in the competition to attract locked funds. DAI and USDC are also the most lent and borrowed stablecoins in the Compound protocol and are also the most borrowed stablecoins in Aave.
However, Tether still holds 80% dominance over the stablecoin market. According to data from CoinMarketCap, the total market capitalization of Tether increased from $9.2 billion on July 15 to more than $13.7 billion as of today, a jump of almost 50%. USDT’s trading volume has surged roughly 150% in the same time period, from $21.9 billion to more than $54 billion as of this writing.
Stablecoin market cap increases by $100M every single day, CoinTelegraph, Sep 4
From: The FxPro News Team https://fxpro.news/daily-forex-outlook/stablecoin-market-cap-increases-by-100m-every-single-day-20200904/
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