There has been a notable shift in the landscape of stablecoins, seeing Tether’s market share descending from 82% to 74% in 2024. This slip in performance comes as rival stablecoin, USDC, enjoys an increasingly prominent market standing. This trend seems to indicate a shift in preference, with investors gravitating towards regulated stablecoins such as USDC. While Tether has enjoyed a commanding presence in stablecoin markets, recent signs suggest its reign may be wavering.
Data reveals that Tether’s USDT trading volume has dipped approximately 8.8% over the last 24 hours, now sitting at around $38.65 billion. This slide is spurred by changes in market sentiments and an upswing in stablecoin regulation. In the meantime, other stablecoin contenders like FDUSD have made significant inroads into the market, in part bolstered by strategic partnerships with entities like Binance.
Also making waves is USDC, with a trading volume that rocketed to $23 billion in 2024 from a modest $9 billion the previous year. This surge in USDC’s popularity is driven by an increased demand for compliant stablecoins. Institutional investors, particularly, are pivoting to regulated stablecoins, eager to maintain their standing and operations within the European Union’s legislative framework. USDC’s market share has now climbed to 12%, doggedly chasing FDUSD’s 14%.
As more players enter the world of cryptocurrencies and stablecoin regulation tightens, Tether’s dominant hold on the market is being increasingly challenged. Regulatory shifts such as the Europe Markets in Crypto Assets Regulation (MICA) are encouraging the adoption of compliant stablecoins, pushing industry behemoths like Kraken to rethink their reliance on stablecoins like Tether. Regardless of what the future holds, it’s clear that the stablecoin arena is in for an exciting ride.