According to data from CoinGecko, the stablecoin market saw a shift in dominance as the largest stablecoin by capitalization, USDT, gained a majority share of 51.31%, for the first time since May 2022. USD Coin (USDC) came in second with 30.64% of the market, while Binance USD (BUSD) accounted for 12.09% and held the third position in the top stablecoins.
As of Feb. 13, the total market capitalization of stablecoins stood at $137.2 billion, with USDT contributing $68.4 billion to the market.
BUSD recently made headlines when the New York State Department of Financial Services (NYDFS) demanded Paxos Trust to stop issuing new Binance USD. Meanwhile, Tether, the issuer of USDT, posted $700 million in net income for the latest quarter and released its reserves report, where Tether representatives claimed that the entire net profit was added to the total USDT reserves. The report stated that Tether holds $67.04 billion in various assets to ensure liquidity.
However, the rise in popularity of stablecoins, as suggested by the Federal Reserve Bank (FRB) of New York’s study titled “The Implications of Digital Assets for Financial Stability,” could pose a threat as it increases risks to the financial system.