Research: Top 4 stablecoins gaining market dominance despite stagnant growth since May Research: Top 4 stablecoins gaining market dominance despite stagnant growth since May
Tether's (USDT) market share stood at 90% in 2020 but has since called to roughly 50% as other stablecoins gained ground in the industry.
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Updated: Oct. 23, 2022 at 3:05 pm UTC
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The top four stablecoins — USDT, USDC, BUSD and DAI — recorded exponential growth throughout 2021 and the first three months of 2022, reaching a peak market cap of $160 billion. However, growth hit a wall in May, when Terra LUNA collapsed, and the collective market cap of the top four is down a significant amount.
The top four
Tether’s (USDT) market share stood at 90% n 2020 but has since called to roughly 50% as other stablecoins gained ground in the industry. The chart below shows the top four stablecoins by their market shares since the beginning of January 2020.
In early 2020, USDT claimed over 90% of the stablecoin market share, while Circle’s USD Coin (USDC) claimed the majority of the remaining 10%.
However, as of October, USDT’s market share has fallen to roughly 50%, with USDC and Binance USD (BUSD) making up most of the remaining majority.
Stablecoin supply
Stablecoins have been steadily leaving exchanges since May, with only brief periods of respite between August and September.
Stablecoins leaving exchanges usually means they are being sold for fiat to meet debt obligations or being moved into a different asset class as investors lose trust n crypto.
Top 4 stablecoins vs. Ethereum
Ethereum’s (ETH) dominance over the top four stablecoins has been on a downtrend since May, with stablecoins becoming more dominant n June — when ETH hit its lowest price for the year.
The top four stablecoins claiming dominance at such a period indicate that investors were inclined to exchange Ethereum for stablecoins in an effort to protect themselves.
After the loss of confidence caused by the collapse of Terra’s algorithmic stablecoin, this turn towards stablecoins is a positive development in restoring trust.
Mentioned in this article
Posted In: Research, Stablecoins
Author 
Zeynep Geylan
Zeynep is an academic who turned to crypto in 2018. Originating in social sciences, she is especially interested in the social impact of blockchain and cryptocurrencies and strongly believes in their transmuting power.
In this article
Terra
$0.60225
Terra (LUNA) is a public blockchain protocol that emerged from Terra Classic.
Ethereum
$3,059.87
Ethereum is a decentralized, open-source blockchain platform that enables the creation of smart contracts and decentralized applications (DApps).
Tether
$1.00035
Launched in 2014, Tether is a blockchain-enabled platform designed to facilitate the use of fiat currencies in a digital manner.
USD Coin
$1.00012
USD Coin (USDC) is a stablecoin fully backed by the US dollar and developed by the CENTRE consortium.
Binance USD
$1.00081
BUSD is a stablecoin issued by Paxos in partnership with Binance..
