Most people think bitcoin is the world’s most used cryptocurrency. It’s the first-ever cryptocurrency and accounts for 70% of all digital assets value. So it would make sense that it’s the world most used right? You will be surprised to learn that tether, is likely to be on the top of the list of the most used crypto.
The truth is that concrete figures are hard to come by when it comes to coming up with these numbers. Data from coinmarketcap.com reveals that the ether token with a market capitalization 30 times smaller had the highest daily and monthly trading value. The tokens volume surpassed bitcoin’s in April for the first time and has consistently maintained its position since early august at about 21 billion a day.
A Higher Trading Volume Than Bitcoin
Tethers monthly trading volume is 18% higher than bitcoin which makes it the most important token in the crypto ecosystem at the moment. The token is also one of the reasons why regulators have to regard crypto with wary eyes amid concerns of market manipulation.
Lex Sokolin, cohead at Consensys admits that with no tether, they stand to lose close to a billion dollars depending on the data source.
Tether, The Worlds Most Used Cryptocurrency
The tether token remains the world’s most used stablecoin. Stablecoins seek to avoid price fluctuations by pegging themselves on fiat. The token is also on a pathway to the world’s most active traders in the market. According to Sokolin with a few questions asked, the token is been exchanged over the counter in countries like China where crypto exchanged are banned. From there, people trade it for bitcoin and other cryptocurrencies.
Jeremy Allaire, Chief Executive Of Circle asserts that many people in Asia like the idea that the cryptocurrency is offshore, opaque and out of reach of the US government. To issue and redeem the token needs an approval process which involves filling a know-your-customer form.
Crypto traders in Asia account for 70% of all crypto trading volume. According to Coin Metrics, Tether was used in 40% of transactions in Binance and 80% of transactions in Huobi.
People Using Tether Obliviously
But Thaddeus Dryja, a research scientist at MIT also asserts that most people are not aware that they use tether. Crypto exchanges are wary of financial institutions trying to sniff out criminals and money launderers, so they don’t have bank accounts. They use tether as a substitute. At the end of the day, people end up using tether without realizing.
The stablecoins control by centralized parties beats the original purpose of decentralization. Tether places trust on big tech companies with mixed accountability. While it can be a good idea, in theory, it still remains a risky business that would be plagued by the same problems the fiat currency faces.