Following the billions of USDT minted over the past week, Tether, a stablecoin issuer, has minted USDT stablecoins worth $1 billion on the TRON network. According to data from Tronscan, the total USDT minted by Tether in the past seven days is $4 billion.
Tether’s USDT Dominates The Stablecoin Market
This significant minting will likely draw attention to the market’s largest stablecoin issuer, subject to frequent scrutiny over its reserves. Tether has consistently claimed that cash reserves back its stablecoin supply.
However, some reports alleged that Tether’s claims were false. Meanwhile, BDO, an accounting firm, recently confirmed that Tether has a surplus of $960 million in reserves.
Tether has raised the proportion of its reserves invested in Treasury bills bringing the figure to 58%. Meanwhile, Tether’s decision to mint more USDT comes amidst heightened competition in the stablecoin sector, with Tether striving to attract investors from its competitors.
Presently, Tether is the leading issuer of stablecoins in the market, and this will not change soon. Nevertheless, concerns persist among some about the possible consequences of a stablecoin like USDT failing, which would significantly affect the industry.
Following a Wall Street Journal investigation, Tether has come under increased scrutiny due to allegations that its partners used falsified documents to provide the company with bank account access. The report alleged that in 2018, Tether employed shell firms to gain entry into the banking system.
USDT Dominance At 18-Month High
However, the challenges USDC faces have worked in Tether’s favor, with the increased minting leading to a surge in USDT’s demand. This is among the factors that analysts believe could allow Tether to maintain its position as the leading stablecoin in the market.
It is anticipated that Tether’s dominance will continue over the medium-term future. The rising demand for USDT could benefit the DeFi market, as USDT is one of the most commonly used cryptos in that space.
Consequently, USDT minting could generate a positive domino effect for the Ethereum ecosystem. According to data from Glassnode, Tether’s dominance in the stablecoin market has peaked within the last 18 months.
With almost 60% of the market share, Tether is the clear leader in the stablecoin market, with USDC second at approximately 27.5%. Additionally, Circle, the issuer of USDC, holding approximately $3.3 billion in the now-bankrupt Silicon Valley Bank, has also played a role in the stablecoin’s recent decline.
Nevertheless, the stablecoin market is a crucial area to monitor. Given the upcoming wave of regulations, it would likely undergo some modifications as the year progresses.
