Global Growth of Stablecoins: Understand What It Is and How It Works
The growth of stablecoins is revolutionizing the financial market, providing stability in a world of volatility. As more investors and financial institutions embrace these digital assets, stablecoins are establishing themselves as a reliable choice for transactions, investments, and protection against cryptocurrency market fluctuations.
Stablecoins are a type of digital currency designed to maintain their value pegged to external assets, such as traditional currencies, commodities, or price indices. They are like cryptocurrencies but with value stability, making them an interesting choice for conducting payments, investing, and guarding against market fluctuations. The main stablecoins currently are USD Coin (USDC), Tether USD (USDT), and DAI.
The stablecoin market is rapidly expanding on a global scale. According to data from CoinMarketCap, the total market capitalization of stablecoins reached $140 billion in October 2023, a 100% increase compared to the same period the previous year.
The growth of stablecoins is driven by various factors, including:
- The increasing adoption of cryptocurrencies worldwide.
- The growing availability of services related to stablecoins by financial institutions.
- The demand for stablecoins as a means of protection against cryptocurrency market volatility.
How Are Stablecoins Used Globally?
Stablecoins are used globally for a variety of purposes, including:
Protection from Volatility: During turbulent times in the cryptocurrency market, investors seek refuge in stablecoins to preserve their assets. When the crypto market stumbled in January 2023, the capitalization of stablecoins soared. This demonstrates that these assets are establishing themselves as reliable options in the financial landscape.
Exposure to the Dollar: Stablecoins offer a way to acquire dollars without the need to hold money in a traditional bank. It is an alternative for those who want to safeguard against crypto volatility or invest in other digital assets without worrying about fluctuations.
DeFi (Decentralized Finance): Stablecoins are also gaining prominence in the world of DeFi. Platforms like Compound and Yearn Finance offer lending and investment products in stablecoins, capitalizing on this feature.
International Remittances: Stablecoins facilitate international remittances quickly and cost-effectively. They are backed by fiat currencies and operate on secure blockchains, enabling swifter transactions compared to traditional methods.
The leaders in this market are:
Tether (USDT): The most widely used stablecoin, with a massive market capitalization of $80 billion. USD Coin (USDC): Second in rank, with a market capitalization of $50 billion. Binance USD (BUSD): In third place, with a capitalization of $20 billion. DAI: A decentralized stablecoin backed by a variety of assets, from cryptocurrencies to commodities.
The global growth of stablecoins is expected to continue in the coming years. As more financial institutions and investors embrace these assets, stablecoins will become even more popular worldwide.
Where to Buy Stablecoins?
The most common way to buy stablecoins is by using cryptocurrency exchanges. At digitra.com, you can exchange the largest stablecoin on the market, Tether ($USDT), by depositing cryptocurrencies. USD Coin ($USDC) and $BUSD are also available on digitra.com.
What Are the Advantages of Choosing digitra.com?
Zero Fees on Transactions: We do not charge fees for buying and/or selling your stablecoin, as long as you maintain 50 digitra tokens ($DGTA) in your wallet, an amount you will receive upon opening an account with the exchange.
Trade to Earn: Every trade you make on digitra.com generates cashback in DGTA for your account. It's easy - you trade, you earn. The distribution of DGTAs is daily, so if you trade every day, you earn every day. Check out more details on the program in the provided text.
Tron and Ethereum Networks Available: You can choose which network to use for your stablecoin transactions. Ethereum's network fees (gas fees) tend to be higher, so many investors prefer to use Tron. At digitra.com, you can choose the one you prefer.