Tether and Circle Control 87% of Stablecoin Market Amid Regulatory Changes
Written by Ohris M. Greyoon, Blockchain & Crypto Expert
Source: Coinmarketcap
Updated: 16h ago- High Market Concentration: Tether and Circle together dominate approximately 87% of the global stablecoin market, with Tether's USDT accounting for 62% and Circle's USDC for 25%, leaving little room for competitors and exacerbating market centralization.
- Regulatory Impact: Proposed U.S. regulations would prohibit payment stablecoins from offering yields, despite these tokens typically being backed by short-term U.S. Treasury bills yielding around 3% to 4%, which could lead to capital flows into opaque alternatives and weaken the market position of compliant stablecoins.
- Yield Migration: As regulatory restrictions take effect, yield-seeking capital may shift offshore or into synthetic dollar products, resulting in decreased transparency for compliant stablecoins and increasing systemic risk, ultimately undermining the stability that policymakers aim to achieve.
- Potential Consequences: Banning yields on compliant payment stablecoins may reinforce market concentration, leading regulatory activities to migrate towards less transparent areas, thereby externalizing risks and potentially harming overall financial stability.
About the author
Ohris M. Greyoon
Ohris M. Greyoon holds a Master’s in Computer Science from MIT and has 10 years of experience in blockchain technology and cryptocurrency markets. A pioneer in decentralized finance (DeFi) analysis, he leads Intellectia’s Crypto News, offering cutting-edge insights into digital assets.
