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Tether, USD Coin, Binance USD, and DAI are all collectively worth more than $78 billion.
The circulating availability of the four main stablecoins has risen to fresh all-time levels, implying that traders may shortly ignite another leg up for the Bitcoin and crypto markets.
After the beginning of the year, the aggregate capitalisation of Tether (USDT), USD Coin (USDC), Binance USD (BUSD), and Dai (DAI) has increased nearly 190 percent, from $27 billion to nearly $78 billion.
In its May 3 Week on Chain report, on-chain analytics provider, Glassnode, noted that Tether is firmly positioned as the stable token sector’s leader, representing two-thirds of the top four stablecoins’ combined capitalization. USDT’s total minted supply hit an all-time high of $51.78 billion at the end of last week after increasing by $1.48 billion or 3% in just seven days.
According to CoinGecko, USDC production has risen by nearly $1 billion in the last week, bringing its capitalisation to $14.5 billion. On April 30, it momentarily reached a high of $15 billion.
On May 3, BUSD’s circulating supply reached a new peak of $7.8 billion, while DAI’s supply is at an all-time high of $3.9 billion as of this writing.
With rising availability, Glassnode states that Bitcoin’s Stablecoin Supply Ratio (SSR), which estimates Bitcoin supply separated by stablecoin supply, is at a year-to-date low of 13.4, nearing its all-time low of 9.6.
The chart reveals that SSR has remained consistently low in 2020 and 2021, as stablecoin supply has increased in direct proportion to Bitcoin’s price increase.
A declining SSR value, according to Glassnode, is a bullish indicator that the global stablecoin supply is growing compared to the Bitcoin market cap:
“As the total supply of stablecoins increase, it suggests an increased ‘buying power’ of crypto-native capital that can be quickly exchanged and traded into BTC and other crypto-assets.”
Aave’s liquidity mining offers, which were announced on April 27, would have boosted stablecoin demand as the bulk of the rewards were geared towards staking USDT, USDC, and DAI. Aave’s yield farming has an immediate effect on stablecoin borrowing volumes, which have more than doubled since late April, according to DeFi investors.