Stablecoins play an increasing role of importance in the cryptocurrency world. These digital representations of fiat currencies remain in high demand, especially where USD-oriented currencies are concerned. However, as the total stablecoin market cap nears $152 billion, one must wonder what the future will hold for these currencies.
Stablecoin Marketcap Keeps Surging
It has been an impressive run for the overall stablecoin industry. Many people doubted the value of digital representations of a US Dollar, Euro, and other fiat currencies. However, most exchanges provide fiat onramps, so there would not be an immediate need for intermediary currencies. That landscape looks very different today. Almost $152 billion worth of stablecoins are in circulation today, a number that keeps going up month over month.
This trend is impressive because the market cap increased by almost 12% in the past 30 days. That confirms the growing demand for exposure to these currencies. Moreover, as they cannot deviate in value, they are less volatile to hold than cryptocurrencies like Bitcoin. Moreover, one can redeem them for the underlying fiat currency at any moment.
Unsurprisingly, the most prominent stablecoin assets are all tied to the US Dollar. Whether it’s Tether’s USDT, USD Coin, BUSD, DAI, or others, they all maintain their peg to $1 with relative ease. Granted, all stablecoins note periods of volatility where that peg is not maintained, although those usually do not last that long. However, Tether’s USDT has crashed well below its normal value in India not that long ago, creating exciting market opportunities.
The market cap rankings confirm there is little interest in currencies not linked to the US Dollar. The first one on the list is Tether Gold, tied to the value of gold bullion. For foreign currencies, STASIS EURS is the most popular one. it has a market cap of just over $101 million. Although far less popular, there are also currencies such as BiLira (TRY), Crypto Franc (CHF), and others.
Will The Industry Keep Growing?
Demand for stablecoins is unlikely to dwindle over the coming months and years. The idea of trading an asset that cannot fluctuate in value yet still offers access to crypto assets is appealing. Moreover, a stablecoin can be useful in the decentralized finance world. It is better to earn yield, interest, or other rewards than keeping money in a bank account. However, that latter option is more likely to cost money rather than yield any.
The bigger question is whether developers can create new approaches to a stablecoin. Relying on funds in a bank account goes in against the decentralized nature of this industry. Projects like The Standard introduce a hybrid gold standard and crypto-backed stablecoin tied to the Euro, which is rather intriguing.
Additionally, algorithmic stablecoin projects aren’t new, yet they still paint an interesting future outlook. There is still much room for exploration and experimentation where stablecoins are considered.
For paid/sponsored articles, FintechMode neither endorses nor takes responsibility for the accuracy, timeliness, quality, and content of said articles. The statements, views and opinions expressed in paid/sponsored articles are solely those of the content provider and readers are reminded that Cryptocurrency products are unregulated in most locations and can be highly risky. Do your own research and consult relevant financial experts before making any investment decisions. FintechMode will not be held accountable, either directly or indirectly, for any harm or loss that may stem from or be linked to the usage or reliance on any information, goods, or services mentioned on this page. If you have any concerns, please email [email protected] or refer to our Terms & Conditions