{"id":36467,"date":"2022-11-28T04:55:06","date_gmt":"2022-11-28T04:55:06","guid":{"rendered":"http:\/\/egrowonline.com\/?p=36467"},"modified":"2022-11-28T04:55:06","modified_gmt":"2022-11-28T04:55:06","slug":"tether-vs-usd-coin-on-chain-data-reveals-two-very-different-stablecoins","status":"publish","type":"post","link":"http:\/\/egrowonline.com\/?p=36467","title":{"rendered":"Tether vs. USD Coin on-chain data reveals two very different stablecoins"},"content":{"rendered":"


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USD Coin (USDC<\/a>), a stablecoin<\/a> issued by the U.S.-based Circle Financials Ltd, is taking the lead over its top rival, Tether (USDT<\/a>), when it comes to institutional adoption, according to on-chain data.<\/p>\n

USDC daily transfer volumes are higher<\/h2>\n

The market capitalization of USDC tokens in circulation comes to be around $44 billion versus USDT\u2019s $65.42 billion. However, USDC\u2019s daily transfer value on the Ethereum blockchain has been consistently higher than USDT throughout 2022, data from Glassnode shows.<\/p>\n

For instance, as of Nov. 22, the USDC daily transfer was around $14 billion compared to USDT\u2019s $5 billion.<\/p>\n

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USDC vs. USDT daily transfer volume. Source: Glassnode<\/em><\/figcaption><\/figure>\n

In other words, USDC users engage in relatively higher capital transfers compared to USDT users, suggesting that USDC is increasingly the stablecoin of choice among high net-worth entities including institutional whales, hedge funds, family offices, crypto exchanges and oth.<\/p>\n

Related:\u00a082% of Tether reserves held in \u2018extremely liquid\u2019 assets, according to attestation<\/a><\/em><\/strong><\/p>\n

Furthermore, USDC leads USDT in terms of its supply weight across smart contracts as of Nov. 22. Notably, the former made up 33.75% of the total stablecoin supply locked across\u00a0staking pools<\/a>. In comparison, USDT\u2019s supply is around 12.50%.<\/p>\n

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USDC vs. USDC supply in smart contracts. Source: Glassnode<\/em><\/figcaption><\/figure>\n

But the higher daily transaction count versus USDC suggests that Tether is more likely used for retail trading and transfers such as remittances<\/a>.<\/p>\n

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USDC vs. USDT daily transaction count. Source: Glassnode<\/em><\/figcaption><\/figure>\n

On the other hand, USDC appears like a top stablecoin choice for tech-savvy institutional traders that lock their funds in staking contracts to earn yield. <\/p>\n

This is further reflected in USDC\u2019s lower daily active addresses count of 40,245 versus USDT\u2019s 73,000, as recorded on Nov. 21.<\/p>\n

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USDC vs. USDT daily active addresses. Source: Glassnode<\/em><\/figcaption><\/figure>\n

Additionally, crypto trading platforms implementing so-called proof-of-reserves\u00a0after the FTX collapse appear to hold more Tether over the USD Coin, further signaling that USDT is likely more popular among retail traders.<\/p>\n

These exchanges include Binance, KuCoin, BitFinex, ByBit, OKEx and Huobi. Crypto.com\u2019s reserves are the exception with more USDC than USDT.<\/p>\n

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Crypto.com’s proof of reserves. Source: CoinMarketCap.com<\/em><\/figcaption><\/figure>\n

Tether market cap dips after FTX collapse<\/h2>\n

The market capitalization of USDT dropped by nearly $4 billion after the FTX exchange collapse nearly two weeks ago.<\/p>\n

The reason may be due to Tether briefly veering off<\/a> from its $1 valuation, hitting 96 cents on Nov. 10, after it froze $46 million worth <\/a>of USDT tokens associated with FTX. <\/p>\n

Interestingly, the USDC market cap rose by nearly $2 billion after Nov. 10 when the FTX fiasco began.<\/p>\n

USDT vs. USDC market cap performance in the last six months. Source: Messari<\/em><\/figcaption><\/figure>\n

Tether has a history of breaking its U.S. dollar peg during extreme market stress albeit to a lesser degree in recent years. <\/p>\n

For instance, the token dropped below 95 cents during the crypto market sell-off in May, coinciding with a spike in USDC\u2019s market cap. This suggests that some investors moved their capital from Tether to USD Coin as the former lost its USD peg, as shown below.<\/p>\n

USDT\/USDC three-day price chart. Source: TradingView<\/em><\/figcaption><\/figure>\n

However, Tether returned to dollar parity within a few days, asserting that the tokens in circulation are backed<\/a>\u00a0100%\u00a0by reserves and pegged 1-to-1 with USDs<\/a>.\u00a0<\/p>\n

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.\n<\/p>\n<\/div>\n


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Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

USD Coin (USDC), a stablecoin issued by the U.S.-based Circle Financials Ltd, is taking the lead over its top rival, Tether (USDT), when it comes to institutional adoption, according to on-chain data. USDC daily transfer volumes are higher The market capitalization of USDC tokens in circulation comes to be around $44 billion versus USDT\u2019s $65.42 […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[40],"tags":[268,21,1372,709,1221,144,1018],"class_list":["post-36467","post","type-post","status-publish","format-standard","hentry","category-market-analysis","tag-coin","tag-data","tag-onchain","tag-reveals","tag-stablecoins","tag-tether","tag-usd"],"jetpack_publicize_connections":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"","_links":{"self":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts\/36467","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=36467"}],"version-history":[{"count":1,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts\/36467\/revisions"}],"predecessor-version":[{"id":36468,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts\/36467\/revisions\/36468"}],"wp:attachment":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=36467"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=36467"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=36467"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}