There has been an increase in the number of stablecoins issued over the past month, mainly on the Ethereum network. That popularity may also be lifting ether on Thursday.
Ether (ETH) prices have climbed 8.4 percent over the last 24 hours, according to CoinDesk price data as of 20:10 UTC (4:10 PM EDT )on Thursday.
Total supply of the top five fiat-backed stablecoins has increased by over 25 percent, primarily led by U.S. dollar-pegged tether (USDT) on the Ethereum network, with over $1.5 billion in issuance since March 12.
The March 12 date is significant because that “Black Thursday” was a volatile day for cryptocurrency markets. Massive selling and derivatives liquidations totaling over $700 million on BitMEX sent prices downward, with ether going below $100 for the first time since 2018.
But this month the cryptocurrency market has been witnessing lower levels of spot trading volume and a dip in volatility after a see-saw March. So why are there more stablecoin assets being issued in this low volume, low-volatility environment?
“I think offshore and non-U.S. participation in getting access to [the U.S. dollar] through stablecoins is the culprit,” said Neil Van Huis, director of sales and institutional trading at digital asset financial services firm Blockfills. Van Huis also referenced the rise of other stablecoins, which compete with tether available on USD exchanges, also fueling growth. USDC, for example, is a joint venture between U.S. crypto companies Circle and Coinbase.
“Stablecoins, outside of tether, have become much more accessible globally,” Van Huis added.
As the world’s largest stablecoin, tether is mostly traded on…