The ascent of Tether’s total assets has been nothing short of remarkable. Over the span of six years, the company has witnessed a stunning rise, bringing its current figure to an impressive $95.2 billion, as outlined in its transparency report. The majority of this sum, around $92 billion, is held in Tether’s dollar-pegged stablecoin, USDT. The firm’s unprecedented growth has amazed even the most seasoned investors, prompting reflections on the exponential nature of innovation and the potential of ambitious projects.
Gabor Gurbacs, a strategy advisor for VanEck and Tether, shares valuable insights gleaned from his unwavering support of the company. Drawing parallels with the Bitcoin ETF, which faced skepticism in its early days, Gurbacs recognizes the tendency of investors to underestimate exponential innovations. He highlights the importance of listening to individuals with audacious visions, even if their ideas seem far-fetched at first. This willingness to embrace the unconventional has played a pivotal role in Tether’s transformative journey.
Tether’s success can be attributed in part to its prudent financial strategies. The company has capitalized on high yields generated by US Treasury bills, employing a portion of the profits to acquire Bitcoin. According to the reserves report, a significant 85.7% of Tether’s reserves comprise “Cash and Cash Equivalents and Other Short-Term Deposits.” Notably, the majority of these reserves (76.4%) are invested in US Treasury bills, while overnight reverse repurchase agreements and money market funds account for the remaining proportion (11% each).
Evolving Stablecoin Market and Tether’s Dominance
The stablecoin market, representing 7.2% of the total crypto market capitalization and totaling $132 billion, has experienced notable shifts. In 2022, stablecoins held a more substantial market share of approximately 16-17%. Tether maintains an overwhelming dominance within this market, claiming nearly 70% of the total stablecoin market share. In a surprising turn of events, Tether’s supply has grown by nearly 40% over the past year, while its prominent rivals have witnessed declines.
While Tether soars to new heights, other stablecoins face contrasting fortunes. Circle’s USDC, once considered a formidable competitor, has seen its supply dwindle by a significant 44% over the past year, reaching its lowest level since June 2021. With only $24.8 billion in circulation, USDC now holds a market share of almost 19%. Ranking as the third-largest stablecoin, MakerDAO’s DAI boasts a circulation of $5.3 billion. Meanwhile, TrueUSD (TUSD) secures the fourth position with a circulating supply of $2.3 billion.
Tether has embarked on an extraordinary journey, amassing a staggering total asset valuation and establishing its dominance within the stablecoin market. Gabor Gurbacs, an unwavering supporter of Tether, emphasizes the importance of embracing exponential innovations and visionary projects. Tether’s success can be largely attributed to its diversified reserves, profitable ventures, and strategic investments. As stablecoin market dynamics continue to evolve, Tether remains at the forefront, leaving its competitors in its wake.
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