The vast majority of alternative stablecoins record multi-month lows for active or sending addresses. Although USDT is the one exception, that asset has other concerns to contend with. Thanks to the ongoing market volatility, it remains unclear if the prices will rebound soon.
Alternative Stablecoins Lose Traction
It is challenging for any cryptocurrency asset to compete with other offerings on the market. For pegged currencies, that battle is even steeper. Providing competition for USDT in the stablecoin segment is virtually impossible. However, several currencies have noted strong growth in recent months, allowing them to expand their reach beyond just crypto trading.
DAI, the native stablecoin of the Ethereum ecosystem, has hit a nine-month low for active addresses. A surprising event, considering how DAi was peaking not that long ago. As overall interest drops again, it will be interesting to see what happens to DAI. Fewer active addresses is not necessarily problematic, but it is worth keeping tabs on.
For USDC and BUSD, there are new lows for sending addresses. That is interesting, considering enthusiasts can buy all cryptocurrencies at roughly 10% below yesterday’s price. However, it appears most crypto traders are not intent on using USDC for that purpose. A four-month low in sending addresses comes at a bad time, but what is done is done.
For BUSD, the US Dollar-pegged currency of the Binance Smart Chain, a similar situation is apparent. Although BUSD hit “only” a one-month low in sending addresses, it too notes a substantial decline in activity all of a sudden. With three stablecoins showing very similar results, one has to wonder what this will mean for the market prices over the coming days and weeks.
USDT Exchange Inflow Rises
Even though these stablecoins all note a decline in activity, there are always exceptions to the rule. USDT, the largest stablecoin by market cap and overall activity, seems to be firing on all cylinders. In line with the recent crypto market crash, there is a strong influx of USDT across the many exchanges. That doesn’t automatically mean the prices of crypto assets will rise, but this liquidity injection can make a difference.
Per Viewbase, there is an influx of over $287.6 million in USDT across the exchanges and trading platforms. A substantial amount, as this represents a 15.1% daily increase. It is not entirely uncommon to see such a steep increase for the leading stablecoin, yet the timing is rather intriguing. It is also the only stablecoin to note such a strong increase.
Interestingly, USDC also notes a strong increase in exchange liquidity. Despite noting a long-term low in sending addresses, the balance on trading platforms increased by over $21.7 million. BUSD, the other stablecoin noting a decline in activity, saw an outflow of over $245.4 million. All of these statistics are remarkable for many different reasons. A price impact may not necessarily occur right away, but anything is possible in this industry.