Tether has established itself as a major fiat stabilizer in the cryptocurrency market, even though its values could still shift below and above the $1 mark, which makes people wonder how stable USD Tether (Crypto: USDT) is as a stable coin.
The arguments have led to inventions by other interested parties who wish to provide a more stable option. The recent announcement of USD Coin (“USDC”) is a good example. USDC is being created by Circle in conjunction with some partners like Bitmain, which invested about $110 million into it. It’s also worth mentioning that one of the major financial giants in U.S., Goldman Sachs, said that they will accept the use of the coin.
Some of the reasons why USDC will not offer much threat to USDT are:
1) It was created by an exchange
2) It would be hard to attain the trading volume of tether
3) Poloniex, the exchange owned by Circle, only controls 0.65% of is USDT total trading volume
It was created by an exchange
Even though USDC is an erc20 token, it is controlled by the people that bought Poloniex. Many other exchanges would prefer to stick to USDT to avoid increasing the market capitalization of the token.
It would be hard to attain the trading volume of USDT
Even though USDT is presently at the 15th position in market capitalization, it often takes the charts as the second most traded cryptocurrency after Bitcoin. It would be quite hard for USDC to attain this level of activity.
Poloniex only controls 0.65% of is USDT total trading volume
It will be good to know that Poloniex controls less than 1% of USDT trading volume. This is insignificant if the other exchanges continue with the use of USDT, which its crypto enthusiasts have trusted for more than three years now.
These reasons are evidence that USDT has nothing to fear about the incoming of USDC.
Contributed by: Nwaru Chukwuemeka
If you are interested in utilizing the Blockchain Relations Brand Network to distribute your content to thousands of followers via 7 different brands and even get paid for it in crypto (or use the option of spending your credit for further distribution to 5,000+ news outlets), visit our page for the Content Submission Program.