Although $USDC has come out of the shadow of depegging and is getting back on track, the recent banking crisis has undoubtedly hit Circle hard. Amid the series of catastrophic events, $USDT became the winner in the stablecoin market.
TokenInsight data shows that the current market cap of $USDT is as high as $74.43 billion, almost double that of $USDC, which has fallen from $43.28 billion a week ago (March 10th) to $37.4 billion now.
After the collapse of Silicon Valley Bank , Circle admitted that $3.3 billion of the $USDC reserves were kept in the bank. The news sparked panic in the market, causing $USDC once depegged to $0.87. Many investors exchanged a large amount of $USDC for other assets, making the market cap of the stablecoin drop sharply. Circle's reserve risk was removed with the US government's announcement that Silicon Valley bank depositors would be made whole, but the company still needed to deal with the huge amount of redemption requests. According information shared by Circle, from March 13th to 15th, it has redeemed $3.8 billion of $USDC and minted only $800 million of the stablecoin.
Tether was almost completely unaffected by the banking crisis, and $USDT attracted a large number of investors who ran away from $USDC. A week ago, the market cap of $USDT was $72.07 billion, and it has now increased by more than $2 billion. According to Blockworks Research, $USDT's market share of the whole stablecoin market is as high as 57.85%, while $USDC's share is 28.07%, down 4.6% from a week ago.
In fact, this is the second time this year that $USDT benefited from a competitor's crisis to consolidate its leading position. A month ago, after Paxos was ordered to stop minting $BUSD, the market cap of the third largest stablecoin began to drop quickly, and a considerable share was converted into $USDT. Now, the market cap of $BUSD is only $8.3 billion, which is nearly 50% less than before the sanction. Meanwhile, $USDC failed to enjoy a market cap grow from the decline of $BUSD.
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