Over the past year, stablecoin lost about $18 billion in market capitalization after the collapse of competitor TerraUSD and the bankruptcy of the FTX exchange. At that time, the capitalization of USDT was $ 65 billion and, in almost half a year, stablecoin managed to regain its former positions.
The restoration of the capitalization of USDT indicates the dominant role of the token in the cryptocurrency market as a means of conducting transactions and storage.
It should be noted that the recent problems of the nearest competitor have favorably affected the USDT. The second largest USDC stablecoin in March of this year suffered from the collapse of Silicon Valley Bank’s banking partner. Also, a month earlier in February of this year, Paxos stopped issuing BUSD stablecoin with a capitalization of $20 billion in accordance with regulatory measures.
Tether has been criticized for many years due to the opacity of liquidity and risky loans to unknown debtors. Last year, the company had to provide USDT support documents as part of the Tether collusion lawsuit to manipulate the BTC price by issuing new tokens.
A Wall Street Journal article reported that in the past the company used fake documents to open bank accounts. However, the holders of stablecoins supported USDT during a turbulent period of increased control by regulators and US banks. This led to the fact that Tether’s market share reached a 22-month high.
An analyst at Kaiko noted in the report that the growth of USDT indicates the importance of linking to a stable digital asset for most holders, rather than the transparency of the issuer. The report also expresses doubts about the excessive growth of the USDT market capitalization, incompatible with the fall in trading volumes.