Category: Stablecoins

Categories
China Crypto News Payments Stablecoins

China’s Xiong’an Region To Pay Salaries in Digital Yuan CBDC

Following last year’s CBDC tests – including free digital stablecoin “red envelopes” handed out to residents – China is continuing its tests to determine the usefulness of CBDCs.

The government of Xiong’an – a region situated 100km southwest of Beijing and known for acting as a testing ground for new technological developments across China – has announced that the salaries of certain residents will be paid in digital yuan, also known as renminbi (RNB).

Construction Workers’ Salaries Paid In Digital Yuan

The digital RNB salaries will be paid mainly to construction workers – at least for now. On payday, batches of RNB will be transferred from the construction company’s public wallet registered with the PBOC to the private wallets of workers.

The CBDC test run will be coordinated by the Shijiazhuang branch of the People’s Bank of China (PBOC), and will be supported by Xiong’an’s reform and development bureau management committee.

In order to carry out the test, the Chinese government designed an app based on the Blockchain Fund Payment Platform, which will assign a digital ID to each person taking part in the experiment.

In closing, the report states that the government will also be looking into ways to ensure workers can use their CBDC without the usual hassle of finding merchants that accept payment in new cryptocurrencies.

Other Countries Looking Into CBDCs

CBDCs, or Central Bank Digital Currencies, are tentative experiments being carried out in China, the EU, Ukraine, Australia and elsewhere that would bring the technological advantages of blockchain to the central banking system.

Categories
Crypto News Stablecoins Tether

Stablecoin USDC Supply Has Been Growing Faster Than Tether in 2021

At the moment, Tether (USDT) is the largest stablecoin by supply. However, it has been losing out in supply growth to USD Coin (USDC), according to the “State of the Network” report by CoinMetrics. 

Tether vs USDC Supply Growth

Following the data on CoinMetrics, the total supply of USDC has risen over $22 billion, or about 57 percent since May and over 450 percent since the beginning of the year. In less than two weeks, USDC grew from a $15 billion USD asset on May 12 to over $20 billion USD. It’s worth mentioning that USDC is one of the fastest-growing stablecoins in the crypto market.

Two plausible factors driving more demand for USDC are market trust and the decentralized finance (DeFi) space. There is a possibility that USDC may soon catch up with USDT, provided the supply trend continues to increase.

USDT has only increased by over 190 percent in supply to a +$61 billion USD asset since the beginning of the year. Tron Network is currently the dominant blockchain for USDT, accounting for more than 50 percent of the entire USDT supply. There is now a lower supply of $30.9 billion USD (49 percent) on Ethereum, probably due to the expensive transaction fee on the blockchain, which led to the increase in demand on Tron. 

Notwithstanding the USDT supply and transaction count, the ERC-20 version of USDT sees more transfer value compared to the TRC-20 tokens, which indicates that both versions of USDT have different use cases, as per CoinMetrics.

BUSD Supply Increase Over 800% Since January

The Binance-backed BUSD is one other stablecoin in the spotlight. BUSD has risen by over 820 percent since the start of the year. There has been a strong demand for stablecoin amid the Binance DeFi space and the incredibly cheap transaction fee on the network. 

Categories
Crypto News Cryptocurrencies Institutions Investing Stablecoins

Circle Beats Crypto Financing Record

Circle, the company behind USDC (currently the second largest stablecoin) just beat the record for the investment round with the most capital received by a crypto-related company.

$18 Million More Than The Previous Record

According to Forbes, the investment round garnered a total of $440 million USD from institutional and private investors alike. It is $18 million USD more than the prior record of $422 million USD raised in 2018 by Bitmain, a company that offers custom crypto mining solutions worldwide.

Aside from setting a new record in the crypto space, this investment is also in the top 10 private fintech investments of all time. Five of the largest crypto-investments in history have been in 2021.

CompanyAmount raised (in USD)Date
Circle$440 million28 May 2021
Bitmain$422 million7 August 2018
BlockFi$350 million11 March 2021
Dapper Labs$305 million30 March 2021
Blockchain.com$300 million24 March 2021
Bakkt$300 million16 March 2020
Coinbase$300 million30 October 2018
Bitmain$292.7 million19 June 2018
Bitso$250 million5 May 2021
Hangzhou Qulian Technology$235 million4 June 2018
Bithumb$200 million19 April 2019
Ripple Labs$200 million1 October 2020

In a public statement, Circle thanked everyone for their trust and reiterated their commitment to using stablecoins in order to improve the payments landscape.

The financing, among the top 10 in private fintech investments, fuels the company’s continued growth, organizational development and market expansion opportunities. We are grateful to our colleagues, customers, strategic partners, investors, regulators and other stakeholders who are continuing to work with us in making Circle’s vision a reality.

Team Circle [source]

Overall, this has been an important year so far for institutional investments into crypto, with the public listing of Coinbase being one the highlights.

Categories
Crypto News Stablecoins Tether

Market Cap of Stablecoins Has Surpassed $100 Billion USD

Market Cap of Stablecoins Has Surpassed $100 Billion USD

The market capitalization of stablecoins has surpassed $100 billion USD, according to market data from CryptoDiffer. As of May 25, stablecoins accounted for more than $86 billion USD in 24hrs trading volume.

Notably, there has been a consistent increase in demand for major stablecoins since the beginning of the year. These coins serve as the base currency for trading in exchange, as well as lending and borrowing on decentralized finance (DeFi) protocols.

Ten Largest Stablecoins by Market Capitalization

Following the information by CryptoDiffer the top ten stablecoins include:

USDT, USDC, and BUSD are some the most popular and traded stablecoins in the cryptocurrency market. They have a combined market capitalization of nearly $90 billion USD, which is about 88 percent of the entire stablecoin market valuation. Demand for stablecoins is increasing rapidly.

On Monday, Tether surpassed the $60 billion USD market cap. Demand for USDT has been increasing significantly in accordance with the entire growth of the cryptocurrency market. For reference, USDT had a market cap as low as $8 billion USD in May 2020, resulting in a 581 percent increase year over year when compared to the current record.

Also, the market capitalization of USDC increased from $18 billion to $20 billion USD within two weeks.

The Binance USD stablecoin has over $8 billion market capitalization, and a 24hrs trading volume of over $15 billion USD, according to CoinMarketCap.

Categories
Coinbase Crypto News Stablecoins Tether

Coinbase Pro Delays Launch of USDT Trading Amid API Issues

Smartphone with Coinbase app logo and black keyboard on wooden background
Smartphone with Coinbase app logo and black keyboard on wooden background

US cryptocurrency exchange Coinbase recently announced it will debut Tether (USDT) trading on its trading platform, Coinbase Pro, this week. However, the launching of the stablecoin has been postponed till May 3, according to the exchange’s notice on Tuesday.

Coinbase Cites API Issues

In a tweet, the crypto exchange cited API issues, precisely saying that they are working to “make sure that we have fully remediated any issues on our core APIs and exchange”.  Besides the API issues, Coinbase is also preparing to bolster its trading platform to make it more robust for users while trading.

USDT trading was previously slated to open on April 26. Following the update, however, Coinbase Pro users are expected to start trading USDT next week.

Coinbase will support the ERC-20 version of USDT, which is based on Ethereum. It began accepting inbound transfers for the stablecoin immediately after the announcement last week.

Coinbase Could See Increases in Trading Volume

The addition of USDT on Coinbase Pro will expand its available coin trading pairs. Precisely, the exchange will support the following trading pairs: BTC-USDT, ETH-USDT, USDT-EUR, USDT-GBP, USDT-USD, and USDT-USDC.

At the time of writing, USDT is the largest and most-traded USD-backed stablecoin in the crypto market. Therefore it seems reasonable for Coinbase to plan scaling its trading platform ahead of the launching of USDT trading, as that could result in more more trading volume.

On Monday, the market capitalization of USDT in circulation crossed $50 billion USD. TRON is currently the largest blockchain network with the highest number of USDT.

Categories
Cryptocurrencies Stablecoins Tether

Another $2 Billion USDT Minted At Tether Treasury

Tether – one of the biggest cryptocurrency stablecoins has minted another $2 billion USDT on the TRON blockchain.

A stablecoin is a new class of cryptocurrencies that price is pegged to an asset like the USD. For example, 1 USDT would equal 1 USD approximately.

What This Could Mean For USDT

Despite certain voices who have criticized Tether for a long time, asking whether USDT really is tied to the US Dollar or not – and how this tethering is actually ensured – Tether representatives and associates have gone on record in the past stating that every Tether token minted is actually backed by a reserve.

The above video is a podcast where Gregory Pepin – the CEO of Deltec bank – talks about the reserves backing USDT. Deltec is the Bahamas-based bank run by Tether Ltd., where their cash reserves are stored.

“We cannot take domestic customers and we cannot hold domestic Bahamian dollars. So that report is actually not relevant. And actually, if [the post’s author] took a little effort to go and dig a bit about the size of the Bahamian market of banking, [that person] would have found out that the entire mass of banks have around $200 billion in assets, I believe. And we are a part of that.”

Although any financial information, whether to do with crypto, fiat or both should be taken with a grain of salt, it’s worth noting that USDT is still one of the largest cryptocurrencies by market cap – so it’s quite possible that this minting is simply the result of new investors, or simply new funds that Tether Ltd. is putting to use. In addition, 2020 has seen the US Dollar ride quite a wave of inflation.

Overall, the minting of $2 billion worth of USDT should not be a cause for worry – but as always, be sure to perform careful research before making any investment.

Categories
Crypto News Stablecoins Tether

Largest USD Stablecoin, Tether (USDT) to Launch on Polkadot and Kusama

Largest USD Stablecoin, Tether (USDT) to Launch on Polkadot and Kusama

Tether is planning to launch its US dollar-backed stablecoin on Kusama, which will be followed by Polkadot, a blockchain network that “facilitates an internet where independent blockchains can exchange information and transactions in a trustless way”.

Besides providing more scalability, part of the objective is to make USDT the first stablecoin that will exist on the Polkadot network, according to the CTO at Tether, Paolo Ardoino.

USDT to Launch on The First Polkadot Parachain

Before Polkadot, the stablecoin will initially go live on Kusama, which is considered a cousin network for Polkadot, basically serving as a preparation network for projects looking to run on Polkadot. USDT’s launch date on Polkadot is subject to the formation of the parachains. Tether wants the stablecoin to launch on the first common goods parachain, according to the CTO.

Tether will likely launch on the first parachain available, StateMint. We expect StateMint to be the first common goods parachain. […] Our integration with Polkadot serves to support the decentralized finance ecosystems that are growing across blockchains.”

Paolo Ardoino, CTO at Tether

USDT Allocation on Ethereum and Tron

Tether’s USDT is the largest and most liquid stablecoin in the crypto market. It’s already a multi-chain asset, and going live on Kusama and Polkadot would mark its ninth and tenth base blockchains, respectively. USDT is currently available on eight different blockchains, which include Ethereum, Tron, Bitcoin Cash’s Standard Ledger Protocol, Solana, EOS, Algorand, Liquid Network, and Omni.

However, the majority of USDT in circulation is currently available on Ethereum and Tron blockchain. According to the Etherscan, about 22.4 billion USDT have been issued on the Ethereum blockchain, and they are held in nearly three million addresses. On Tron however, there are 20.9 million USDT on the network.

Categories
Banking Crypto News Institutions Stablecoins

Japan’s Central Bank Starts Experimenting With Digital Yen

On Monday the Bank of Japan (BOJ) started a year long study with its central bank digital currency (CBDC), following the advances made by China, U.S., and European countries.

This follows the BOJ’s announcement in early October 2020 where a project overview was given. The first of three phases is to be carried out now until March 2022. This phase is a proof-of-concept phase where participants will “build a systematic experimental environment and verify the basic functions of issuance, distribution, and refund, which form the core of CBDC as a payment method.”

In proof-of-concept phase 2 the study will look at “adding peripheral functions of CBDC to the experimental environment constructed in Phase 1 and verify its feasibility.” And if it is deemed necessary after proof of concept, they will consider conducting a pilot experiment in which private businesses and consumers can participate.

Shinichi Uchida, executive director of the bank, said in a statement last month that some people questioned whether people could use cash and bank accounts instead, and others wondered if potential cases for a CBDC “could be addressed by alternative solutions that did not require such extensive and large-scale efforts.”

Central Bank of Japan [Wikimedia]

CBDCs are similar to stablecoins, except that they are state-run. This means that transaction data are not on a public blockchain and that the central bank maintains authority over the ledgers that hold this data. The implementation of a system like this will allow participants to transact, store, and track the currency as an official unit of account since it’s registered with the central bank, thereby also increasing security against fraud and other related crimes.

Japan Doesn’t Want To Be Left Behind

The BOJ is mainly looking at digital currencies in a case it were to become mainstream or yield major benefits for them. BOJ Governor Haruhiko Kuroda has said it is important to “prepare thoroughly to respond to changes in circumstances,” and that it is not an appropriate policy response for central banks to start considering digital currencies only when the need to issue one arises.

Smaller banks like those in the Bahamas and Cambodia have already launched their CBDC, like the “Sand Dollar“. Japan’s economic rival has also made some major strides in the digital currency arena. According to a Chinese media source six state-owned banks have begun to promote digital yuan and accepting applications to open digital wallets. As well as U.S. Federal Reserve Chairman Jeremy Powell stating that a potential digital dollar is a high-priority project but has remained cautious about issuing one.

While there is no change in the BOJ’s stance it currently has no plan to issue CBDC, we believe initiating experiments at this stage is a necessary step

Shinichi Uchida, BOJ Executive Director

If, after a year, the bank finds that the proof-of-concept phase was fruitful, it will progress to the next phase: a pilot program. As countries start to adopt their own version of digital assets it opens more doors for individuals to interact with this technology and become familiar with how it works.

Categories
Crypto News Stablecoins Tether

Tether’s USDTs are Fully Backed, Moore Cayman Confirms After Audit

Tether's USDTs are Fully Backed, Moore Cayman Confirms After Audit

According to this announcement by Tether, third-party audit and assurance services provider Moore Cayman has confirmed USDTs in circulation are fully backed.

Over the recent years, many FUD (Fear, Uncertainty, and Doubt) stories have circulated in the cryptocurrency space concerning Tether’s asset reserves. Many people had argued that the company was only posting figures and that its US dollar-backed stablecoin (USDT) were not fully backed.

This controversy was mostly fuelled by the massive number of USDTs usually minted by Tether. Some people were concerned that the cryptocurrency market, especially Bitcoin (BTC), would crash if there were evidence that Tether’s assets are not fully backed. This announcement might help reduce all these FUDs and worries amongst crypto investors.

USDTs are Fully Backed by Tether Reserve

At the time of writing, there were over 40.6 billion USDTs in circulation, according to CoinMarketCap. Judging by Moore Cayman’s assurance report, it’s believed that Tether’s reserves back all these assets.

“Tether has always been fully backed, and the assurance opinion we made available today confirms it once again. As Tether’s growth in the market continues to validate our business, we understand the public’s interest in this matter and are pleased to share this attestation as part of our ongoing commitment to transparency,” Tether noted in the announcement.

USDT Remains the Largest Stablecoin

Stablecoins are backed by an asset, and USDT, in this case, is backed by the United States fiat currency. USDT is the largest and most-traded USD stablecoin in the crypto market. It has a market capitalization of over $40 billion, ranking as the fourth-largest digital currencies. 

The USD Coin (USDC) is the second-largest US dollar-backed stablecoin with over $10 billion in market capitalization. Recently, Visa added USDC as a settlement currency.

Categories
ChainLink Crypto News DeFi Stablecoins

Chainlink Becomes Sole Provider of Price Data for Origin Dollar (OUSD)

Chainlink (LINK) Oracles have now been integrated onto the Origin Protocol’s mainnet as well as becoming the sole provider of real-time price data for OUSD.

According to a press release from Origin Protocol, the integration of Chainlink price oracles are a “big deal” for the growth and security of the only stablecoin that earns a yield while still in your wallet.

What Does The Integration Mean for Origin Protocol?

By going all-in on Chainlink, we ensure that our users have the highest quality data and most secure oracle infrastructure every time they mint or redeem OUSD. Importantly, Chainlink has given Origin the flexibility to interact directly with oracles built specifically to price certain stablecoin trading pairs, leading to decreased on-chain costs and a more accurate minting/redeeming process.

Matthew Liu, Origin Protocol Co-founder

Additionally, the first Chainlink Price Feed for Origin Tokens (OGN-ETH) is now live and available for use by other DeFi protocols wanting to quickly and safely launch support for OGN markets. The OGN-ETH Price Feed is already being used and supported by the C.R.E.A.M. lending platform.

Since the DeFi boom, it has become increasingly important to use the most accurate price data, making Chainlink tech more valuable to companies working in the DeFi space. Today, Chainlink oracles are one of the most important linchpins to the security of DeFi, securing billions of dollars in on-chain value. Demand is only growing as DeFi gains more widespread adoption and protocols opt for the highest standards of data quality and reliability.

Chainlink USDT-USD Price Feed Oracle Network [Medium]

These Chainlink nodes collectively source price data from numerous off-chain data aggregators like BraveNewCoin and Amberdata, ensuring each price point has volume-adjusted market coverage across all trading environments.

Slow Price Data can Lead to Losses

Traditionally when origin was using a mixture of oracle providers:

[…] prices had to be calculated by first fetching the price of ETH and then calculating the exchange rate using ETH oracles. This increased the chance of prices being outdated, causing users to receive less OUSD than they reasonably expected. It also increased the gas costs due to additional on-chain transactions.

Josh Fraser, Co-founder Origin Protocol

One benefit of having these direct price feeds is that it simplifies smart contract code. In the Ethereum world, simpler code also means gas savings, which is now roughly 15% cheaper when minting or redeeming OUSD, thanks to this direct price feed integration.

But since they now rely on numerous secure nodes and premium data sources, OUSD users receive highly accurate, available, and tamperproof price data, which is also inherently resistant to various data manipulation attacks such as those carried out via flash loans.