The stablecoin market, spearheaded by Tether, is on the cusp of a remarkable achievement, with its total assets nearing the $100 billion mark. This impressive growth is a testament to Tether’s dominant position as the world’s largest stablecoin by market capitalization. According to the latest transparency report, Tether’s total assets stand at $95.2 billion, of which $92 billion is attributed to its dollar-pegged stablecoin, USDT.

Tether’s Exponential Growth

Tether has experienced an extraordinary surge in its market capitalization, growing by 6,560% since the beginning of 2018, just six years ago. Gabor Gurbacs, a strategy advisor for both Tether and VanEck, recently expressed his continued support for Tether, recalling his earlier predictions about its potential growth. He remarked that investors often undervalue exponential innovations and emphasized the impact of small, determined teams in bringing these innovations to fruition.

Tether’s Financial Strategy

Tether has been leveraging high yields from US Treasury bills, with a portion of its profits being invested in Bitcoin. According to the reserves report, 85.7% of Tether’s reserves comprise “Cash and Cash Equivalents and Other Short-Term Deposits.” Of this, 76.4% are in US Treasury bills, 11% in overnight reverse repurchase agreements, and the remaining 11% in money market funds.

Stablecoin Market Dynamics

Stablecoins currently account for 7.2% of the total cryptocurrency market capitalization, totaling $132 billion. This figure has decreased from the 16-17% market share stablecoins held in 2022. Tether dominates this market with a nearly 70% share. Over the past year, while Tether’s supply grew by roughly 40%, its competitors experienced declines. Circle’s USDC supply dropped by 44%, falling to its lowest level since June 2021, with just $24.8 billion in circulation. MakerDAO’s DAI and TrueUSD (TUSD) follow as the third and fourth largest stablecoins, with $5.3 billion and $2.3 billion in circulation, respectively.

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