Bitcoin is the pioneer cryptocurrency. Since it came into use, it has gained tractio. Also, it is accepted in different areas of life. From online shopping to tuition payment, buying of foods at restaurants, subscription for services, to transportation, bitcoin is accepted.
However, there are cryptocurrencies that are used more than bitcoin. Though bitcoin accounts for about seventy percent of the crypto market value, it is not the most used cryptocurrency in the world. If the bitcoin is not the most traded, then which crypto is?
Tether is trading more than bitcoin
It is not always good to base one’s argument on feelings or hearsay but evidence. Available data from CoinMarketCap.com indicate that though tether has a far less market capitalization than bitcoin, the former is in hotter demand.
Tether’s demand first overtook bitcoin’s in April 2019, and a lot of persons may not have paid attention to that disruption. However, since early August, tether has regularly performed better in trading volume than bitcoin and garnered about $21 billion daily.
The focus on tether has ensured that the coin is surpassing bitcoin’s monthly trade volume with about 18%. This is why the tether is currently seen as the most important coin in the crypto market.
Regarding tether’s daily performance, Lex Sokolin, global technology co-head at Consensys, says,
If there is no Tether, we lose a massive amount of daily volume around $1 billion or more depending on the data source, some of the concerning potential patters of trading in the market may start to fall away.
Coins that are most traded per day
The last 24 hours performances on the CoinMarketCap.com show the trading volumes of the top coins to be: Tether $17,094,787,634, Bitcoin $14,136,217,305, Ethereum $6,423,083,121, Litecoin $2,569,512,664, EOS $1,412,349,784, XRP $1,387,463,846, Bitcoin Cash $1,301,789,038, TRON $709,860,517, Ethereum Classic $398,320,461, and Paxos Standard $268,527,760.
Tether remains the world’s most used Stablecoin
With the volatility that characterizes the crypto ecosystem, stablecoins are gradually becoming popular. The rise in the fame of stablecoins is partly responsible for the surge in demand for tether. But why exactly is the need for stablecoins on the rise?
They are a way of escape from fluctuation
The prices of cryptocurrency are hardly stable. They could be in hundreds of dollars in the morning but change to a few thousand in the evening, vice versa. Stablecoins have pegged a coin to a dollar, thereby ensuring they are stable and hedged against fluctuation. The moment the coin market goes bearish, the sellers tend to transfer their assets into tether to ensure they do not lose their value.
A corridor for Chinese traders into the crypto market
The harsh stance of several countries against cryptocurrency has made it impossible for interested investors to come with confidence in the ecosystem. Besides the clampdown on exchanges, there are fears that investors might lose their hard-earned money should they come in.
However, in some countries like China, people have access to buy tether with cash over the counter without passing through rigorous interviews. Once they have tether, they can easily exchange it for bitcoin. While bitcoin trading is less prevalent in such countries, the demand for tether keeps surging.
Jeremy Allaire, chief executive officer of Circle, has a particular affinity for USD Coin, one of the tether’s rival stablecoins. Speaking on Bloomberg, Jeremy said,
For many people in Asia, they like the idea that it’s this offshore, opaque thing out of reach of the U.S. government.
According to the Allaire, Asian traders make up 70% of all volumes of trade carried out in crypto, and tether was used in 40% and 80% of all transactions on Binance and Huobi, two of the top exchanges in the world.
It acts as a substitute for dollars
With the ease of transferring tether coins between crypto exchanges and other online platforms, more users are settling for the coin. This is because they are routed through the banking system. Its stable prices readily make them useful instruments to bet on altcoins‘ course.
Skepticism about Blockchain
In the time past, most of the tether operations were done using the Bitcoin blockchain through the Omni Layer. The coin has gradually moved away from this shift by adding EOS, the Lightning Network, and TRON. This smart move is to avert any grievous problem a severe bull run could have on bitcoin.
Tether’s evolution toward blockchain agnosticism will enable them to have the upper hand and avoid any consequence of bitcoin congestion on its progress.
Effects of Network
Tether has been in the crypto ecosystem since 2014. The coin has, therefore, taken time to consolidate and gain the trust of users. Tether began to grow in fame in 2017. This stablecoin has already cemented its position, thereby making it impossible for the newcomers to push it aside. Though most of its competitors are relatively new in the system. As more and more people patronize the coin due to the trust they have built, its popularity keeps increasing.
Tether is shrouded in controversies
Tether continues to be engulfed in one controversy to another. Many potential investors regularly see the relationship between the coin and a company based in Hong Kong. This same company that issues tether also owns the crypto exchange Bitfinex. While bitcoin belongs to nobody in particular, the tether is issued by a company, which may make it not transparent enough.
Besides, there are also issues relating to how the coin is increased or reduced. It is needless to say that the amount of tether backed by fiat has been a subject of debate as well.
Tether is trusted despite the controversies
Though there are lingering controversies concerning tether, a lot of people still continue to put their trust in the coin. This is responsible for the recent rise in fame and the currency overtaking bitcoin in trade volume. Part of the trust arises from the long period the coin has been in the crypto ecosystem; plus, the distrust of the relatively new competitors.