Discard Bitcoin! Stablecoins now make up 15% of the total crypto market


Stablecoins are now reigning the market and is beating Bitcoin and Ethereum’s economies

This year, cryptocurrencies had a wild ride as Bitcoin and Ethereum fell over 70% since their all-time highs in November 2022. Earlier, experts said that the crypto market’s correlation with the stock market had worsened the state of the digital asset domain. The markets took a sharp turn in June, where major stablecoins fell too, owing to the unexpected volatility of the market. Besides, a significant chunk of the total crypto market value fell due to the recession, heightening interest rates, and the growing involvement of crypto regulators and legislators.
Nevertheless, people’s interest in crypto continues to remain high. But their growing interest now surrounds the stablecoins. Reports claim that stablecoins now constitute almost 15% of the total crypto market value. The combined market value of Tether, USD Coin, and Binance USD has doubled this year, spiking from 7% in January to 16% in December. Meanwhile, the largest cryptocurrencies in the market, Bitcoin and Ethereum are constantly rejecting major price floors and pushing investors toward more losses. So, is it time for stablecoins to take over the market? Let’s dig deeper.

The State of Stablecoins in the Crypto Winter of 2022

The recent market volatility is deemed to be special for a lot of reasons. Thanks to the recession headwinds, rising interest rates, and the war in Ukraine, even some of the safest investments assets in the crypto market fell drastically. TerraUSD (UST) was one of the fastest-growing stablecoins in the market, and its disastrous fall shook the entire market. UST lost almost 98% of its market cap, butchering whatever gains Bitcoin and Ethereum gained over the past year.
The massive implosion of TerraUSD also caused several other major cryptocurrencies like Tether and BinanceUSD to lose their peg to the US$1. This drastic change made investors flee the market as the probable safe investments in the market also proved to be extremely volatile. Generally, stablecoins are considered a worthy investment by new investors entering the market and for low-risk seeking crypto users, as mentioned earlier, stablecoins are considered the safest investment asset class in the markets. But the fall of the stablecoins in 2022 shook the investment community, leading to several investors fleeing the market.

So, are Stablecoins Good Investment Options Right Now?

Reports demonstrate that stablecoins had the greatest rebound among cryptocurrencies. These cryptocurrencies have shown much resilience to market volatility and have increased their market share substantially. Tether has doubled its market share by expanding it by 7.7% since its fall after TerraUSD. The marketcap of the world’s second-largest stablecoin USD Coin jumped from 1.9% to 5% during this same period. BUSD’s market share increased four times to 2.6%. Now together, these three stablecoins have made up 15.3% of the total crypto market value, which demonstrates a heightened improvement in its price movements.
In a nutshell, when the summer of 2022 brought forward the coldest slumber for the crypto market, as we near the end of the year, stablecoins are attempting to reestablish the market’s lost prominence in the economic and financial markets. However, investors still have to be extremely careful while dealing with these cryptocurrencies and should constantly avail the advice of financial consultants.


Link: https://www.analyticsinsight.net/discard-bitcoin-stablecoins-now-make-up-15-of-the-total-crypto-market/

Source: https://www.analyticsinsight.net

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