Leading cryptocurrency exchange Binance now holds a large sum about $ 1 bln of USDT stablecoin
In times of a sharp decline in the cryptocurrency market, USDT stablecoin is becoming increasingly important. Even the market cap of USDT has increased as it gradually gained strong acceptance, now amounting to much of Ethereum’s network traffic.
$ 1 billion worth of USDT stablecoin is sidelined on Binance
In particular, tracking the movements of USDT has brought investors new signals about potential market trends. And this signal came about, with data indicating that Binance currently holds a large sum of stablecoins.
According to Jason Choi – a Wharton School graduate that is the Head of Research at crypto hedge fund The Spartan Group – there is now just shy of $ 1 billion worth of Tether sitting on the sidelines on Binance. This does not include other stablecoins that the platform supports, including Binance USD, USD Coin, Paxos Dollar, etc.
There is ~$1B in USDT sitting on the sidelines on @binance alone. pic.twitter.com/5LwGZ7g3Jq
— Jason Choi 蔡浩霆 (@mrjasonchoi) April 14, 2020
On each chart, this metric is up 1,000% from the mere ~ $ 100 million on Binance at $ 10,500 in mid-February. A majority of the growth took place after the “Black Thursday” crash in the price of Bitcoin and other crypto-assets.
The exponential growth of the number of USDT stablecoins currently on Binance signals one thing: the demand for USDT is rising fast, considering that the growth of Binance’s USDT is relatively stable, not marked by large spikes that show Tether’s direct deposit. That would suggest individual investors are depositing their stablecoins on the exchange. And likely they can’t wait for unloading their USDT for cryptocurrencies, be that Bitcoin, Ethereum, or otherwise.
A broad resurgence in the total value of stablecoins in existence
Not only USDT has witnessed strong growth, but over the past few weeks, the total value of the stablecoin market has also increased sharply. In it, Nic Carter from CoinMetrics shows that the full value of these assets has risen the rally dramatically.
Carter stated:
“Stablecoins collectively tacked on over $ 2b in March 2020 – by far their best month ever. Nontether stablecoins grew by $ 500m.”
As of now, the value of all stablecoins has surpassed $ 8 billion, or about 4.2% of the entire cryptocurrency market. The sentiment is that the market will reach a point where these investors will want to sell their stablecoin shares to Bitcoin, causing a rapid rise in the cryptocurrency market.
In early 2019, Su Zhu, CIO, and CEO and hedge fund Three Arbow Capital, said:
Theres an estimated $2B in cash sitting at crypto funds/holdcos. Theres another $2B+ sitting in stablecoins, and another $2B sitting at exchanges/silvergate/signature.
This is $6B fiat already onboarded to crypto to buy your bags. Imagine thinking we need new money to hit $10k.
— Su Zhu (@zhusu) February 18, 2019
Read more:
- Tether (USDT) Balances On Exchanges Hit A New Record At 1.282.118.378 USDT
- $ 7 Billion Stablecoins “Waiting” To Enter In The Market And The Number Is Still Increasing