As per the latest data compiled by crypto analytic platform, IntoTheBlock, USDC stablecoin recorded its second-highest volume ever.
USDC wins the fight
laughs said that with Bitcoin and Ethereum dipping below $21,000 and $1,100, the total on-chain trading volume on USDC reached $38.72 billion.
Interestingly, this isn’t the first time that USDC has sailed through smoothly in the time of a market downturn.
During the UST de-peg and eventual collapse, Circle’s flagship stablecoin also managed to bridge the gap to the first centralized stablecoin, Tether’s USDT. It was the time when extreme fear gripped the market and investors abandoned USDT for USDC, which became the stablecoin of choice on the Ethereum blockchain.
In fact, USDC has been gaining market share since the once-$18 billion UST stablecoin went on a death spiral, and USDT’s price wobbled.
Currently, it is the second-largest stablecoin with a market capitalization of $54.23 billion, second only to Tether, which stands at a market value of $70.77 billion, according to CoinMarketCap. Much of the effort can also be attributed to stablecoin issuer and fintech company Circle for pushing USDC adoption through acquisitions and other initiatives.
History Repeats?
The recent market downturn was triggered by the crypto lender – Celsius’s decision to suspend all withdrawals and transactions in a bid to prevent a run on deposits. Amid the worsening macro events on a global scale and liquidity crisis in crypto, another controversial dollar-based stablecoin wobbled.
While centralized stablecoins trade very well, it is the algorithmics that again create problems. This time it was USDD, a stablecoin founded by Tron creator Justin Tron in May 2022, which slipped from the dollar peg despite the over-collateralized reserve.
It slipped to the lows of $0.974. According to Sun, the cause of de-pegging was large numbers of short sellers targeting TRX, the network’s native token, on Binance. In an effort to reestablish the peg, the exec said that the Tron DAO Reserve would pledge as much as $2 billion to fight the short sellers.
TRON DAO Reserve, which manages the stablecoin, revealed that it would withdraw 2.5 billion TRX from Binance to “protect the entire blockchain industry and crypto market.”
