In the history of the cryptocurrency market, stablecoins have played a crucial role in stabilizing the profits of traders. According to the latest crypto market data, the stablecoins have a reported valuation of approximately $130.8 billion and a 24-hour trading volume of around $28 billion.
For More Context: Stablecoins vs. Fiat Currencies: Features, Differences, and Factors.
As global crypto regulations increase, stablecoins denominated in different global currencies have emerged. Among the most traded stablecoins are those denominated in US dollars, the euro and the Japanese yen, among others. This trend allows traders to hold assets in their preferred currency and avoid fluctuations in value due to currency exchange rates.
What stablecoins are the whales accumulating?
According to a study by market intelligence platform Santiment, crypto sharks and whales are amassing the best stablecoins as DAI from MakerDAO. As the Bitcoin-led crypto market hovered around $28k, Santiment noted that large crypto investors increased their rate of stablecoin accumulation. In particular, DAI is a favorite among cryptocurrency users who prefer to generate stablecoins on their terms.
“Even with the roller coaster of crypto markets in April, sharks and whales are amassing major stablecoins like $DAI. Since $DAI was swapped to pump $BTC and $ETH in mid-March, $100k-$10m DAI addresses have added 6.4% of the supply since.”
Governance by MKR token holders
Additionally, a community of MKR token holders governs the Maker protocol and the smart contracts that power the DAI stablecoins. This decentralized governance model allows token holders to vote on changes to the protocol, including setting the stability fee and determining the collateral fee.
However, a recently published report by Glassnode indicated that the stablecoin market has continued to shrink from its peak of around $161 billion. The decline can be partly attributed to the drop in Binance-backed BUSD earlier this year. However, the overall stablecoin market remains significant and is essential to the stability of the cryptocurrency market.
This post Massive Stablecoin Influx, Is Another Market Crash Imminent?
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