The dominant position of stablecoins in the cryptocurrency industry is not surprising. These pegged currencies have become the default trading pair for Bitcoin, Ethereum, and other top markets. Moreover, the total supply on Ethereum has surpassed $86 billion, which is relatively impressive.
Stablecoin Supply on Ethereum Keeps Growing
One would think there is only so much demand for stablecoins in the cryptocurrency industry. Moreover, only a few of them are effectively successful, although things seem to change in that regard. More stablecoins on the market have proven an exciting development, even though they serve no speculative purpose whatsoever. A pegged currency cannot deviate in value that much, albeit they are not necessarily stable either.
Today, Tether’s USDT remains the top stablecoin by market cap on Ethereum. However, demand for USDC, BUSD, and others is still growing. As a result, the combined stablecoin supply sits at $86.32 billion, most of which is represented by Tether’s USDT. Surprisingly, it appears that USDC may overtake Tether fairly soon in these rankings.
More specifically, the Tether supply sits at $33.935 billion. That is a fair amount, yet USDC is closing in at $29.963 billion. This week’s 17% increase in supply gives these rankings a competitive aspect that would otherwise not be present. Binance USD and DAI complete the top four, with no other stablecoin noting a total supply of over 1 billion at this time.
Interestingly, a few stablecoins saw their weekly growth increase significantly. The most significant growth comes from Gemini Dollar, with a 9,996.8% increase. DAI saw an influx of 448.87%, followed by Paxos Standard’s 318.79%. A very intriguing development for the Ethereum blockchain, although most of these pegged currencies exist on other blockchains.
Negative Growth Can Be A Problem
Whereas the overall supply of stablecoins on Ethereum keeps trending higher, things differ from one stablecoin to another. Synthetix’s sUSD, for example, saw the supply reduce by 2,547.6%, down to 130.473 million. An intriguing development that shows the need for burning coins when there is no financial backing for them. However, every project handles that aspect differently.
An even bigger negative growth is noted by Liquidity USD or LUSD. Its supply is now negative on Ethereum, at -74.288 million. This week’s 3,203.71% decline is not helping matters much in this regard. Recovering from a negative on-chain balance may be tricky, although it remains to be seen what happens to liquidity USD in the coming weeks. It remains an intriguing development either way.