Stablecoins Have Fascinated Wall Street Investors as Stable Digital Assets
For Chinese exchange users, Tether has replaced the yuan as the go-to fiat currency.
Bitcoin is known for its high-volatile nature and its price goes and up abruptly. The case is the same for other cryptocurrencies such as Ether, Ripple, BCH, and others. However, stablecoin is a less-volatile digital asset. Due to its non-volatile essence, stablecoin is acting as a trusted asset for investors.
The US presidential candidate Michael Bloomberg proposed a financial reform plan. Per the plan, there will be clear-cut rules and regulations for crypto-related firms and aims for ‘’ providing a clear regulatory framework for cryptocurrencies.’’ The Trump administration is also planning to implement better laws for crypto regulation.
Besides adoption on a large scale, Wall Street still has uncertainty for cryptocurrency and hesitates to claim it as a trusted asset. However, investors attracted to stablecoin for its stability as compared to cryptocurrency. The pegged digital coin is providing a bridge between cryptocurrency and fiat currency.
Traditional Assets linked with crypto are Bullish
After scanning the traditional markets, the interesting thing comes out: the assets linked with digital currencies, one way are the other, are more bullish than others. For example, Grayscale Bitcoin Trust (GBTC), the crypto investment firm, is up 57.39% in the year-to-date performance.
Overstock.com, Inc. (NASDAQ:OSTK) is another company that accepts payments in crypto. In year-to-date, it is also surged by 23.83%. Both gained double-digits figures as compared to traditional ones.
Widespread Adoption of Stablecoins
Out of many, few stablecoins managed to make their place in the crypto industry. One is Tether (USDT) that is pegged with the US dollar. The Chinese traders are favoring Tether over other cryptocurrencies. Chainalysis reported, ‘’for Chinese exchange users, Tether has replaced the yuan as the go-to fiat currency.’’
In 2019, USDT has seen a good rise in terms of adoption as the coins’ supply increased from 2 billion to 4.108 billion. Out of all, Tether is growing rapidly as it takes an 80% share of stablecoins.
Another prominent stablecoin is Dollar Neutrino USDN that is also pegged with US dollar but algorithmically. This coin provides annual staking reward in case of USDN’s staking. Another stablecoin that popularized in the crypto community is called USD Coin (USDC). Currently, the market cap of USDC is reaching $423M.
At the start, Facebook announced to launch its cryptocurrency. But later on, they changed their plan and informed the crypto community about stablecoin that is pegged by many fiat currencies. This shows users want stable coin as compared to volatile cryptocurrency.
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