Although Tether (USDT) has long been the largest stablecoin in the cryptocurrency market, recent reports indicate that its dominance is facing challenges. Despite maintaining its top position, Tether is gradually losing its market share due to fierce competition.
According to the latest statistics from Kaiko, about 82% of all cryptocurrency transactions are currently denominated in top dollar and euro-pegged stablecoins, while fiat currencies only account for 18% of the market share. Despite this, USDT's total trading volume has exceeded $3.6 trillion this year, which is almost four times that of its closest competitor, Hong Kong-based First Digital's FDUSD.
However, USDT's market share on centralized exchanges (CEXs) has been declining, with Kaiko estimating it to be 69% from 82% at the beginning of the year. In addition, the market share of USDC, which is backed by Circle, is also rising, indicating a preference for regulated alternatives. Currently, U.S.-issued stablecoins account for 10% of total stablecoin trading volume. However, its share has increased from less than 1% in 2020 to 11% today.
