Circle’s stablecoin has been hit hard by the industry-wide volatility that occurs on a regular basis. A Coin Worth One Dollar in USD (USDC). Even the whale’s wallets seemed to be giving off warning signs. The narrative takes shape as the most widely used wallet addresses for USD Coin sink to new lows within the last two years.
According to Glassnode’s numbers, for instance, USDC’s indicators have been trending downwards as of late. The recent market events and sell-offs have impacted the stablecoin’s market capitalization.
So, What’s the Deal with All This?
The capitalization of Tether (USDT) and USDC were significantly impacted by the United States’ sanctions against crypto mixer Tornado Cash. After more than 75,000 USD Coins were frozen from wallets associated with Tornado Cash, the market capitalization of USD Coin dropped. The USDT market cap increased by nearly $2 billion in the days following the penalties.
Seven-day moving averages of US dollar deposits have fallen to a 17-month low of 138,250. (Glassnode data). In March of last year, it was recorded at a value that was -138,810. Many have speculated that users may have switched their USDC holdings to USDT due to the similarities in the two stablecoins’ price movements. 87.667% of USDCs are held by the top 1% of wallets, according to data compiled by Glassnode; this percentage is at a 22-month low.
Nonetheless, I Have Some Really Great News
Even though USDC’s market cap is relatively low, it has shown strength in one area recently. The stablecoin’s weekly mean transfer volume spiked, reaching a three-year high. Many people believe that USD will overtake USDT as the most valuable stablecoin by 2022. Currently, USDC is trading at a price that is only $11B away from matching the value of USDT.
Yet, after the Tornado Cash crisis, the latter lost all of its progress. Despite recent gains, USD Coin’s market cap is still only $4. This causes people to have a wide variety of hopes and fears tied to the stablecoin.
In the meantime, the cryptocurrency market is trying to recover from recent losses. The total value of all cryptocurrencies on the market increased by 2.24 percent in the 24 hours prior to the writing of this article, standing at $1.03 trillion. Also, Bitcoin jumped $1.78 to trade at $21,360 at the time of publication.
In spite of this, the market is still showing signs of weakness, and bears may gain another round of dominance. Following some upswing attempts, bearish tendencies have emerged. In any case, the upcoming sessions are still crucial to follow. Keep reading to learn all the breaking crypto news.