USDT's Stablecoin Supply Increases Amid Crypto Market Recovery, What's WRONG?

USDT supply is increasing amid the recovery of the crypto market. (Photo; Doc. BTC Reservoir)

JAKARTA Tether USDT is the largest stablecoin by market cap, beating Circle USDC and BUSD. USDT has reportedly increased to a two-month high. This increase coincided with the crypto market rally in recent weeks.

In addition, USDT's stablecoin market cap also rose 3.8 percent from its lowest level on November 27, USD 65.3 billion to USD 67.8 billion on Sunday. This is USDT's highest point after the FTX crash that rocked the crypto market at the end of last year.

For information, the value of the USDT stablecoin is tied to one to one US dollars. This stablecoin has become the most widely used crypto asset in the digital asset industry.

According to Blockworks, data collected by NYDIG over the previous 30 days showed that USDT had facilitated more than $980 billion in exchange trading volumes, compared to BUSD of $323 billion and USDC of 135 billion US dollars.

This technology and financial services company shows an increase in stablecoin supply as evidence of increasing capital flow to the market and is a positive sign based on previous events.

"We think Tether's sustainable supply growth is a positive indicator for a sustainable price rally," the company said in a Friday newsletter, January 27, 2023.

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The growth in stablecoin supply seems to have followed the recovery trend that occurred in 2019. At that time, the price of bitcoin jumped from $3,250 to more than $13,000 before falling back in the second half of the year. This development also occurred ahead of the increase in bitcoin prices which reached 130 percent from August 2020 to January 2021, along with an increase in stablecoin supply by 100 percent.

While not everyone agrees that the increase in USDT supply is closely related to the increase in bitcoin prices, William Banjir, Treasurer of Australian Zerocap trading firms, said there was an increasing interest in the accumulation of digital assets and transaction flows in stablecoins recently.

However,aiman tidak dapat memastikan apakah ini merupakan korelasi langsung dengan pergerakan pasokan USDT atau hanya penyesuaian risiko pada peristiwa ekonomi macro. Banyak mengatakan bahwa salah satu katalis yang lebih mungkin adalah beberapa pertemuan kebijakan bank pusat ini, termasuk potensi penurunan laju pengetan dari Federal Reserve AS.

On the other hand, Tether as the publisher of USDT has failed to attract accounting firms to audit its reserve funds. This condition is different from its competitor, USDC, which is actively audited by related parties.