Tether USDt

USDC

<p>A recent report from CoinGecko reveals that 8.7 million cryptocurrency wallets currently hold stablecoins. The majority of these stablecoins are concentrated in three major types: $USDT, $USDC, and $DAI, which together account for 97.1% of all <a href="https://blockchainreporter.net/glossary/stablecoin/" rel="noopener noreferrer nofollow">stablecoin</a> holdings.</p><h2 id="header-0">USDT, USDC, and DAI Show Increased Stablecoin Stability Post-Banking Crisis</h2><p>Stablecoins, as the name suggests, are designed to offer price stability, their prices linked to another asset – fiat, or commodities. These tokens, when created, have had issues of holding to their supposed pegs especially in volatile markets. For example, during the banking crisis in the middle of March 2023, unclarity of deposits in Silvergate and Signature Bank made some stablecoins drop their peg. However, prominent stablecoins such as USDT, USDC, and DAI have noted increased stability in recent times.</p><p>Other stablecoins that are relatively younger or ones that are partially created on an algorithm basis such as USDD and FRAX are even more volatile. These newer models have often focussed on market incentives to sustain themselves but have also experienced mixed success. Still, some stablecoins have proven to be unstable. These include Iron Finance and Basis Cash could not sustain their pegs.</p><h2 id="header-1">Stablecoins Remain Vital for Bridging Fiat and Crypto Worlds</h2><p>The report by <a href="https://coingecko.com/" rel="noopener noreferrer nofollow">CoinGecko</a> also revealed the expanding market capitalization of stablecoins. Fiat-backed stablecoins have more than tripled in market capitalization to $161.2 billion as of August 2024 but are below the all-time high of $181.7 billion seen in early 2022. Based on trading volume, dollar pegged stablecoins Tether ($USDT), USD Coin ($USDC), and Dai ($DAI) account for over 94% of the total market capitalization. The pool is still heavily controlled by Tether which has the 70.3% and USDC’s share further reduced after the banking crisis.</p><p>Stable coins generally pegged to specific commodities albeit have not dominated the space though have experienced slight growth. Their market cap stood at $1.3 billion as of August 2024, which was just 0.8% of the total fiat-backed stablecoin market cap.</p><p>Ultimately, stablecoins are quite valuable within the blockchain industry and are used as instruments that help connect fiat currencies with cryptocurrencies. Some of the reasons for their continued use include, ability to remain fairly stable during the fluctuations in the market.</p>

Stablecoin Adoption Surges: 8.7 Million Wallets Hold Amid Market Volatility

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