September 29, 2023

The world’s largest stablecoin, Tether (USDT) has expanded its circulating supply after nearly three months of declines, which could be a sign that crypto markets are slowly recovering.

The first mint in nearly three months took place on July 29, and there have been three more, with the last on August 2, according to CoinMarketCap. The USDT injections were small, however, increasing Tether’s market cap by just 0.7%, or just under $500 million.

USDT market cap 7D –

According to the Tether slide report, there are now 66.3 billion USDT in circulation. This gives the stablecoin a total market share of around 43%.

Tether supply hit an all-time high in early May when it topped 83 billion USDT. The collapse of the Terra ecosystem, subsequent cryptocurrency transmission and large-scale acquisitions forced the company to reduce its circulating supply, which fell 21% to a low of 65.8 billion at the end of July.

This has enabled rival company Circle to increase the market share of stablecoin USDC, which now has a 36% share with a market capitalization of $54.5 billion. As reported by Cointelegraph last month, USDC volume on Ethereum actually overthrew Tether’s for a period as the number two stablecoin continues to close.

Over the weekend, Binance CEO Changpeng Zhao commented about the amount of stablecoins that are going to come back into the markets, stating:

“3 of the top 10 are stablecoins, which means there’s a lot of fiat on the sidelines, ready to go back. If people wanted to get out of crypto, most won’t hold stablecoins.”

Stablecoins currently account for 13.6% of the total cryptocurrency market cap, which is near all-time highs

Related: Circle’s USDC on track to dethrone Tether USDT as the top stablecoin in 2022

A cost of living crisis caused by rising global inflation may have put the brakes on crypto investing and speculation for retail traders. However, those living in countries with extreme levels of inflation, such as Argentina, have held hard currencies pegged to the USD as a hedge against their own currencies.

Tether acknowledged the benefits of owning the stablecoin, stating that USDT “allows Argentines to access a market that is truly global and frees them from local black markets,” adding that it also “empowers them to hold Tether in ways that they cannot be seized by the government, unlike local bank accounts.”