to tie [USDT] must definitely feel USD Coin [USDC] he’s breathing down his neck in terms of market cap as investors watch the wreckage of TerraUSD [UST] and reassess their stablecoin preferences. To that end, two metrics-based milestones tell us a lot about USDC demand — and its potential future.
The horse has left the stable
Glassnode reported that USDC liquidity on Uniswap has hit lows last seen about 16 months ago. Why is this significant? Well, declining liquidity on Uniswap is a sign of high demand and may indicate that users are attracted to stablecoin.
$USDC Liquidity on Uniswap just hit a 16-month low of $199,797,454.26
Previous 16-month low of $201,664,641.14 was observed on May 12, 2022
View metric: https://t.co/dYndhpGfMH pic.twitter.com/oE8ZRQiEhT
— glassnode alerts (@glassnodealerts) May 20, 2022
On the other hand, it’s important to look at all the evidence. Santiment data showed that USDC supply on exchanges has risen since about May 17, even after USDC price returned to normal levels.
Source: Santiment
In comparison, the supply of UST held on exchanges has fallen since the de-pegging of UST. But while you might assume the numbers are now close to their all-time highs, the truth is that UST’s supply did not rise to the level last recorded until the end of April.
Source: Santiment
Awake or not, here I come!
At the time of printing, the USDC rate fell, suggesting fewer USDC stablecoins moved between addresses. However, this does not mean that nothing will change for investors.
Source: Santiment
In fact, is more USDC leaking out of the whales’ grasp and flowing to more mundane investors? Glassnode data showed that the top 1% of addresses owned only about 91.226% of USDC supply. While this may still seem like a lot, it’s actually a 13-month low.
$USDC Percentage of supply held by addresses with the highest 1% has just hit a 13-month low of 91.226%
Previous 13-month low of 91.239% was observed on May 12, 2022
View metric: https://t.co/EU57HUtLdu pic.twitter.com/L3t1zVBDSO
— glassnode alerts (@glassnodealerts) May 20, 2022
A report from Glassnode on May 16 also noted USDC’s increasing role in the crypto ecosystem, stating:
USDC reversed the trend of supply contraction that has been going on since late February and grew by $2,639 billion.
It added,
“Given USDC’s dominant growth over the past two years, this could be an indicator of a shifting market bias away from USDT and towards USDC as the stablecoin of choice.”
This post Why USD Coin? [USDC] may not be ready to catch up with Tether yet [USDT]
was published first on https://ambcrypto.com/why-usd-coin-usdc-may-not-yet-be-ready-to-overtake-tether-usdt/
