Tether has achieved a circulating supply of $113.13 billion as of July, marking a significant milestone since the collapse of the Silicon Valley Bank in March 2023.
According to IntoTheBlock (ITB) data, the collapse of SVB in 2023 was a turning point for the stablecoin market as traditional finance institutions turned to USDT for stability.
Vincent Maliepaard, marketing director at ITB, explained that USDT’s accessibility and liquidity are the main reasons for its dominance as the preferred stablecoin for traders and investors.
The overall growth of stablecoin market capitalization has continued after the collapse of SVB, rising from $137.86 billion in December 2022 to approximately $150 billion by July 2024, according to ITB data.
The stablecoin market is gaining global exposure, thanks to regulatory initiatives such as the new Swiss Financial Market Supervisory Authority stablecoin issuer guidelines.
ITB data shows that this increased exposure has led to increased trust and liquidity in the market, with stablecoins like DAI, FDUSD, and USDM witnessing transactions exceeding $100,000.
In July, Circle USD (USDC) made regulatory progress by becoming the first global stablecoin issuer to comply with the new European Union’s Markets in Crypto-Assets regulatory framework. However, despite this development and its $33.71 billion market capitalization, USDT’s market cap of $113.13 billion remains significantly higher.
Maliepaard explained that USDT’s success is not only due to its role in decentralized finance and trading but also its broader applications.
A report by Elliptic Research on July 10 revealed that the Huione Group, a conglomerate in Cambodia, was involved in facilitating online scams in Southeast Asia. The report showed transactions exceeding $11 billion linked to money laundering and cyber scams on the Huione Guarantee marketplace, mainly through the use of USDT. However, the use of USDT made it easier to track illicit funds through the blockchain than traditional fiat flows.