The market capitalization of tether (USDT), a popular stablecoin, has increased while other stablecoins such as Circle’s USD coin (USDC) and MakerDAO’s DAI briefly lost their pegs over the weekend. As a result, other major stablecoins like Binance USD (BUSD) and USDC have seen their share of the stablecoin market drop. This year, BUSD has lost nearly half of its market cap to reach $8 billion, while USDC has decreased by 11% to $39 billion. Tether’s market cap, on the other hand, has increased by 10% to $73 billion, making it nearly twice the size of USDC, the second-largest stablecoin in the industry. The recent surge in tether’s market cap happened after USDC, its primary competitor, lost its peg over the weekend due to news that Circle had $3.3 billion out of $40 billion in reserves for USDC deposited in Silicon Valley Bank (SVB).SVB collapsed on March 10th, but the US Government later rescued and guaranteed that all depositors would regain access to their money. However, the government bailout effectively saved USDC, which later traded back to its $1 peg price. As a result of the de-peg, many market players moved funds from USDC to USDT, putting a lot of sell pressure on the USDC-USDT trading pair, according to Kevin March, co-founder of the trading firm Floating Point Group. Tether’s status as one of the least regulated and least transparent stablecoins could be working in its favor since providing too much information could make stablecoins susceptible to runs.
