{"id":496108,"date":"2022-09-26T15:13:59","date_gmt":"2022-09-26T12:13:59","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/3-reasons-why-usdc-stablecoin-dropping-below-50b-market-cap-is-tethers-gain\/"},"modified":"2022-09-26T15:13:59","modified_gmt":"2022-09-26T12:13:59","slug":"3-reasons-why-usdc-stablecoin-dropping-below-50b-market-cap-is-tethers-gain","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/3-reasons-why-usdc-stablecoin-dropping-below-50b-market-cap-is-tethers-gain\/","title":{"rendered":"# 3 reasons why USDC stablecoin dropping below $50B market cap is Tether&#8217;s gain"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a257259d84f1\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a257259d84f1\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/3-reasons-why-usdc-stablecoin-dropping-below-50b-market-cap-is-tethers-gain\/#%E2%80%9D_3_reasons_why_USDC_stablecoin_dropping_below_50B_market_cap_is_Tethers_gain_%E2%80%9C\" >&#8221; 3 reasons why USDC stablecoin dropping below $50B market cap is Tether&#8217;s gain &#8220;<\/a><ul class='ez-toc-list-level-2' ><li class='ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/3-reasons-why-usdc-stablecoin-dropping-below-50b-market-cap-is-tethers-gain\/#Binances_USDC_suspension\" >Binance&#8217;s USDC suspension<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/3-reasons-why-usdc-stablecoin-dropping-below-50b-market-cap-is-tethers-gain\/#Whales_ditch_USDC_after_Terra_fiasco\" >Whales ditch USDC after Terra fiasco<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/3-reasons-why-usdc-stablecoin-dropping-below-50b-market-cap-is-tethers-gain\/#Tornado_Cash_sanctions\" >Tornado Cash sanctions<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_3_reasons_why_USDC_stablecoin_dropping_below_50B_market_cap_is_Tethers_gain_%E2%80%9C\"><\/span>&#8221; 3 reasons why USDC stablecoin dropping below $50B market cap is Tether&#8217;s gain &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div class=\"post-content\" data-v-6ebd806f>The market capitalization of USD Coin (USDC), a stablecoin issued by U.S.-based payment tech firm Circle, has dropped below $50 billion for the first time since January 2022.<\/p>\n<p>On the weekly chart, USDC&#8217;s market cap, which reflects the number of U.S. dollar-backed tokens in circulation, fell to $49.39 billion on Sep. 26, down almost 12% from its record high of $55.88 billion, established merely three months ago.\u00a0<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-09\/e5731296-c39b-4867-be21-e160c55767f2.png\"><figcaption style=\"text-align: center;\"><em>USDC versus USDT weekly\u00a0<\/em><em>market cap<\/em><em>\u00a0chart. Source: TradingView<\/em><\/figcaption><\/figure>\n<p>In contrast, the market cap of Tether (USDT), which risked losing its top stablecoin position to USDC in May, crossed above $68 billion on Sep. 26, albeit still down 17.4% from its record high of $82.33 billion in May 2022.<\/p>\n<p>The divergence between USDT and USDC shows investors&#8217; renewed preference for the former. Let&#8217;s take a look at the factors boosting Tether as the top stablecoin.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Binances_USDC_suspension\"><\/span>Binance&#8217;s USDC suspension<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Binance, the world&#8217;s largest cryptocurrency exchange by volume, announced earlier in September that it would convert its users&#8217; USDC balances for its own stablecoin, Binance USD (BUSD). The conversion will commence on Sep. 29 and does not <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ly to USDT.<\/p>\n<p>The exchange said it wants to &#8220;enhance liquidity and capital-efficiency for users&#8221; via what appears to be a forced conversion in an increasingly competitive stablecoin sector. As a result, Binance suspended spot, future and margin trading in USDC.<\/p>\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\">8\/ 1. Binance&#8217;s forced &#8220;Auto-conversion&#8221; is blatantly monopolistic behavior of a typical FinTech company<\/p>\n<p>They are no better than traditional banks that have the power to freeze or take control of user funds<\/p>\n<p>Where is the decentralized future that <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/hashtag\/Web3?src=hash&amp;ref_src=twsrc%5Etfw\">#Web3<\/a> users were promised?<\/p>\n<p>\u2014 Momentum 6 (@Momentum_6) <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/Momentum_6\/status\/1572616720162127872?ref_src=twsrc%5Etfw\">September 21, 2022<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p>USDC&#8217;s market cap has plunged by $9.5 billion since the announcement.<\/p>\n<p>Following Binance&#8217;s footsteps, the India-based cryptocurrency exchange also stopped deposits of USDC beginning Sep. 26.<\/p>\n<p><strong><em>Related:\u00a0Binance: No plans to auto-convert Tether, though that \u2018may change\u2019<\/em><\/strong><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Whales_ditch_USDC_after_Terra_fiasco\"><\/span>Whales ditch USDC after Terra fiasco<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The USDC supply help by top 1% addresses (aka whales) has dropped to 88.36% in September from its year-to-date high of 93.84% in February, according to data collected by Glassnode.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-09\/271bbf4d-317b-4ce9-b776-b3ac7e66c21c.png\"><figcaption style=\"text-align: center;\"><em>USDC supply held by top 1% addresses. Source: Glassnode<\/em><\/figcaption><\/figure>\n<p>Interestingly, the plunge accelerated after Terra, a $40-billion &#8220;algorithmic stablecoin&#8221; project, collapsed in May, stirring a negative sentiment toward the entire stablecoin industry. <\/p>\n<p>For instance, the total market cap of all stablecoins saw the worst correction in 2022, dropping from a February high of $97.37 billion to $80.65 billion in September, according to CryptoQuant.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-09\/ebcacf1b-540e-4db7-b3f1-0369941e06b6.png\"><figcaption style=\"text-align: center;\"><em>All stablecoins&#8217; circulating supply. Source: CryptQuant<\/em><\/figcaption><\/figure>\n<h2><span class=\"ez-toc-section\" id=\"Tornado_Cash_sanctions\"><\/span>Tornado Cash sanctions<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The USDC market cap plunge has also accelerated after the U.S. Treasury imposed sanctions on crypto mixing service Tornado Cash over money laundering concerns.\u00a0<\/p>\n<p>Circle responded to the sanctions by freezing all USDC wallets owned by Tornado Cash. The firm also\u00a0prevented addresses that may be associated with the banned mixing service from using USDC. In contrast, Tether <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/tether.to\/en\/tether-holds-firm-on-decision-not-to-freeze-tornado-cash-addresses-awaits-law-enforcement-instruction\/\">avoided<\/a> blacklisting Tornado Cash addresses.<\/p>\n<p>Independent market analyst Geralt Davidson treated Circle&#8217;s response to the Tornado Cash sanction as a cue that holding USDC is riskier compared to its stablecoin rivals. <\/p>\n<p>&#8220;People now have realized there is more risk holding USDC, Circle blacklisted all the USDC on Tornado Cash addresses sanctioned by US Treasury,&#8221; he <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/CryptoInsider23\/status\/1557209772641792002\">noted<\/a> in August 2022, adding:<\/p>\n<blockquote><p>USDC seems like the only token being blacklisted, while other ERC-20 tokens were not.<\/p><\/blockquote>\n<p>Davidson also <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/CryptoInsider23\/status\/1573538506764300289\">treated<\/a> Tornado Cash as one of the reasons why USDC whales have been dumping the stablecoin in recent months.<\/p>\n<p class=\"post-content__disclaimer\">The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.\n<\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/3-reasons-why-usdc-stablecoin-dropping-below-50b-market-cap-is-tether-s-gain\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; 3 reasons why USDC stablecoin dropping below $50B market cap is Tether&#8217;s gain &#8220; The market capitalization of USD Coin (USDC), a stablecoin issued by U.S.-based payment tech firm Circle, has dropped below $50 billion for the first time since January 2022. On the weekly chart, USDC&#8217;s market cap, which reflects the number of&#8230;<\/p>\n","protected":false},"author":1,"featured_media":496109,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDkvYmI5MzE3YjItOWIyMi00OWJkLWFhZDEtMDY3YTdlYzAwNmZmLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74867,75014,75936,76153,75493,122378,82350,73785,71523,36041,87950],"class_list":["post-496108","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-altcoin","tag-binance","tag-circle","tag-dollar","tag-stablecoin","tag-terra","tag-usd-coin","tag-markets","tag-sanctions","tag-tether","tag-whale"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/496108","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=496108"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/496108\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/496109"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=496108"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=496108"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=496108"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}