While Bitcoin has been rallying towards $13,000 – easily crossing $12,000 and pushing further up — so the rest of the market has followed, and that includes the far more controlled stablecoin market.
Tether, the biggest and most popular stablecoin, has minted almost half a billion new USDT tokens and distributed more than 185 million tokens to exchanges and other addresses in the last 36 hours.
This bolster in the stablecoin market comes around the major announcement from PayPal which seems to have sparked the cryptocurrency market. In a statement, the payments giant confirms that PayPal customers will use Bitcoin, Ethereum, Bitcoin Cash, and Litecoin starting in early 2021 to shop at the 26 million merchants on their network.
Good for the market
Tether minting has often been linked with Bitcoin price rallies, and although the PayPal announcement certainly was a major catalyst, Tether minting could well have played its role in making this a stronger rally.
Having a strong Stablecoin market in the cryptocurrency space has a positive effect on the market as it holds a solid value that cannot be affected by the markets. When the markets crashed in March this year there was a rally by a number of stablecoin minters to essentially push value into the market with pegged dollars.
In April this year, Tether minted 160 million USDT during Bitcoin’s price rally to $9,000. It came one week after research was released that argued that USDT isn’t used to manipulate Bitcoin’s price.
Tether on the rise
Tether has shown to be the most widely used cryptocurrency as its trading volume often outshines even Bitcoin despite its market cap being far smaller — although it is growing. Tether’s market cap has grown by more than 400% year-to-date to reach $15.9 billion.
Stablecoins have shown their worth as a digital asset made specifically for transfer of value in an ecosystem with many volatile assets. The separation of coins which do not change their worth gives credence to the idea of digital cash.