The entire Tether (USDT) team was on cloud nine today after the stablecoin hit a new milestone surpassing $40 billion in market capitalization. The new market cap highlights the rapid growth the crypto experienced over the past year.
According to Coingecko, it is now the fourth-largest cryptocurrency displacing Cardano (ADA) that has recently been experiencing a dip alongside Bitcoin and other altcoins.USDT now has a market cap worth more than XRP, DOT, UNI among others.
In terms of stablecoin rankings, USDT is four times larger than USD Coin (USDC), which has a market cap of around $10 billion. USDT dominance is currently around 67%, according to Messari.
According to the USDT developers, Tether’s market cap was $4 billion in March 2020 and now, in March 2021, it has climbed to $40 billion, a 900 percent increase in its market capitalization. It has also contributed hugely to the total market cap of the entire crypto market which surpassed $1 trillion in January for the first time. Earlier this month again, it hit $1.8 trillion.
Tether has just surpassed a $40B market cap! 🎉
In March 2020, Tether’s market cap was $4 billion! Since then, we’ve seen 900% growth in only one year! 👩🏽🚀🚀
— Tether (@Tether_to) March 24, 2021
USDT is considered a bellwether stablecoin because its supply reflects the market’s demand for cryptocurrencies. USDT is the quote currency for cryptocurrencies on several major exchanges, including Bitfinex, which has one of the most liquid BTC markets in the world.
However, in the past, it has been subject to intense scrutiny because it is loosely pegged on the U.S dollars (USD). The stablecoin affiliations with Bitfinex have also contributed largely to the intense scrutiny.
When Tether got in trouble Bitfinex
Several doubt which has led Tether to be closely scrutinized has been laid to rest recently after the office of the Attorney General of New York settled a case with the stablecoin.
New York authorities alleged that the stablecoin developers misrepresented the degree to which Tether (USDT) coins were backed by fiat collateral. the lawsuit alleged that USDT was not fully backed by reserves at certain times. Specifically, Bitfinex is alleged to have opened a line of credit with Tether to repay an $850 million shortfall from the failure of its former partner, Crypto Capital Corp.
Bittfinex and Tether were ordered to pay $18.5 million for damages to the state of New York and submit to periodic reporting of their reserves.
They were also asked to report their reserve status and budget and any transactions between the two companies, as well as provide public reports for the specific composition of their cash and non-cash reserves.
The stablecoin, however, has surpassed this hurdle and currently celebrating its $40 billion milestones.