Tether’s stablecoin, USDT, has achieved a new high, hitting the $84 billion mark in supply. This growth, reflecting an approximate $1 billion increase in the past week, aligns with a market surge tied to potential approval of a Bitcoin spot ETF. The achievement was succinctly announced by Tether’s CEO, Paolo Ardoino, on social media platform X.
Tether’s Rise to Dominance Amid Market Turmoil
The global crypto landscape has seen its fair share of twists and turns, with stablecoins facing their unique set of challenges. Yet, amidst this, Tether’s USDT has proven its resilience, reaching an impressive market share of nearly 70%.
Recently, Tether’s USDT supply hit an all-time high, crossing the $84 billion mark. Data sourced from CryptoSlate indicates that this milestone was reached following a $1 billion increase in market capitalization in just a week.
This rally is largely tied to the growing anticipation of a potential Bitcoin spot ETF. Celebrating this feat, Tether’s CEO, Paolo Ardoino, shared a concise post on social media platform X, stating “84B $USDt.”
Past Hurdles and Challenges
The journey hasn’t been entirely smooth. Just last year, USDT saw its market cap dip to $66 billion. This downturn coincided with the collapse of major crypto players such as FTX and Three Arrows Capital. Alongside, doubts about the stability of USDT’s reserves also emerged, pointing to its potential susceptibility to widespread market upheavals.
Why USDT’s Supply Continues to Climb
Several factors have contributed to Tether’s ascendancy this year, including an increase in its token supply by about $18 billion. The setbacks faced by competitors like Binance USD (BUSD) and USD Coin (USDC) certainly played a role.
Regulatory actions, such as the NYDFS’s directive to Paxos to halt BUSD minting and the SEC’s move to categorize BUSD as a security, led to a decline in its supply from a high of $22 billion in November 2022 to a mere $2 billion now.
On the other hand, USDC’s credibility was questioned after its exposure to the U.S. banking crisis came to light. Circle, its issuer, admitted to holding a chunk of USDC reserves in the now-defunct Silicon Valley Bank. This revelation led to USDC’s value temporarily dropping to $0.87, although it did bounce back.
Yet, in contrast to its rivals, USDT’s circulation has grown steadily. According to data from DeFillama, its market dominance now hovers close to the 70% mark.
From CTO to CEO: Ardoino Takes Charge
USDT stablecoin issuer, Tether, has announced a significant change in its top-tier management. Paolo Ardoino, is poised to step into the role of Chief Executive Officer this coming December.
He has not just been the technical brain behind Tether but has also emerged as its public persona, often being the face answering the hard questions for the most traded crypto globally. Interestingly, Ardoino will retain his CTO position at Bitfinex, considered Tether’s sister exchange.
Tether’s Tumultuous Journey
Despite being the kingpin of the stablecoin realm, Tether hasn’t had a smooth ride. It has grappled with regulatory challenges and faced flak for perceived opacity concerning its reserves. In 2021, Tether settled claims by paying over $40 million, stemming from allegations of misrepresenting its collateral.
Critics have specifically pointed fingers at Tether’s dependency on commercial paper, especially during volatile market phases. However, in a bid to counteract this criticism, Tether has initiated the release of quarterly attestations of its reserves and engaged third-party audits.
Insider reports indicate that Ardoino is not just stopping at quarterly attestations. He has grand plans for Tether’s future, including unveiling real-time data on its reserves. But Ardoino’s vision extends beyond just transparency. He is keen on engaging directly with regulators, exploring options for renewable energy, and amplifying investments in technology.
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