In Bloomberg's latest Crypto Outlook, it is speculated that the market capitalization of Tether (USDT) could surpass that of Ethereum next year.
The October issue of the Crypto Outlook report, published monthly by Bloomberg, is titled “Bitcoin Trend, Adding Zeros (Bitcoin trend, sum of zeros)”. It is written by Bloomberg Senior Commodity Strategist Mike McGlone and highlights current market trends that are driving Tether's growth.
In particular, it highlights how Ether's market capitalization has been relatively stagnant of late, while that of USDT jumped to an all-time high of almost $ 16 billion early October.
Tether currently ranks third overall among all existing cryptocurrencies by market capitalization, with tremendous growth in 2020.
In January, it capitalized only about $ 4 billion, while now this figure has almost quadrupled.
In fact, ETH also nearly quadrupled its market capitalization in 2020, from around 14 billion to more than 43 billion, but it hasn't grown in the past two months.
Why is Tether's market capitalization growing?
The reasons that are driving markets to increase demand for USDT lie in an increasingly widespread adoption of stablecoins and central bank digital currencies (CBDCs).
USDT is clearly the most widely used stablecoin in the world, with a 71% dominance in the market capitalization of all stablecoins.
USDT also plays an increasingly important role within the entire digital asset ecosystem, particularly in trading.
It is enough to consider that the BTC / USDT pair is by far the most traded on cryptocurrency exchanges, even more than BTC / USD.
In addition, major US dollar-guaranteed stablecoins are also increasingly used for remittances and decentralized finance (DeFi).
According to the Bloomberg report, Tether represents what many cryptocurrencies are noti.e. a stable form of payment, while the still deflating big crypto bubble since 2017 is slowly migrating funds to USDT.
The report also predicts that the continuation of quantitative easing measures by central banks and rising levels of the debt-to-GDP ratio could help bitcoin rise, with an expected price of $ 100,000 in 2025.
The CTO of Tether, Paolo Ardoino , He said.
“Aside from Bitcoin, of course, which is the king of all cryptocurrencies, tether is, in some respects, the digital asset of our time. As the most stable, liquid and reliable stablecoin, it is driving a lot of innovation in crypto right now. Tether is lubricating many of the powerful protocols that Ethereum has given birth to, such as DeFi's. Of course, we don't see ourselves competing with Ethereum. However, overshadowing Ethereum's market capitalization, which currently exceeds $ 40 billion, will be a powerful statement.
We definitely see Tether as a complement to Bitcoin rather than a competitor. Tether once again proves to be one of the most trusted assets in the crypto space. Our team is also working to continue growing in online commerce and traditional finance ”.