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Crypto stablecoin Tether (<a href="https://cointelegraph.com/tether-price-index">USDT</a>) has crossed an all-time high market capitalization of $100 billion, posting a 9% year-to-date growth and furthering the gap between its next-largest rival, USD Coin (<a href="https://cointelegraph.com/usdc-price-index">USDC</a>).
USDT momentarily hit its $100 billion milestone on March 4 as the market capitalization fluctuates based on the current price and circulating supply,&nbsp;<a href="https://www.coingecko.com/en/coins/tether" target="_blank" rel="noopener nofollow">according</a> to data from CoinGecko.
It’s over $71 billion ahead in market cap compared to its closest <a href="https://cointelegraph.com/news/circle-usdc-ipo-filing-report">stablecoin rival, USDC</a>, issued by Circle, which has also seen its market cap grow this year.
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Chart showing USDT market cap growth in the last seven days. Source: CoinGecko
On the other hand, Tether has yet to breach the $100 billion milestone on other <a href="https://coinmarketcap.com/currencies/tether/" target="_blank" rel="noopener nofollow">data</a> sources, such as CoinMarketCap.
Tether’s market cap places it around par with the British oil and gas titan BP and a little above the e-commerce giant Shopify.
Tether is a cryptocurrency pegged to the price of the United States dollar available on 14 blockchains and protocols, <a href="https://tether.to/en/transparency/#usdt" target="_blank" rel="noopener nofollow">according</a> to its website.
It’s the third-largest cryptocurrency by market capitalization behind Ether (<a href="https://cointelegraph.com/ethereum-price">ETH</a>), and it has grown to play a key role as a blockchain-based option for crypto traders needing a stable asset.
Over the past month, the crypto market has sprung back to a <a href="https://cointelegraph.com/news/crypto-recaptures-2-trillion-market-cap-bitcoin-climbs-above-57000">market cap above $2 trillion</a><a href="https://cointelegraph.com/news/crypto-recaptures-2-trillion-market-cap-bitcoin-climbs-above-57000"></a>, with Bitcoin (<a href="https://cointelegraph.com/bitcoin-price">BTC</a>) seeing a 50% price increase and notching two-year price highs.
The company that issues the token — also called Tether — claims to back each USDT token 1:1 with its independently audited <a href="https://tether.to/en/transparency/#reports" target="_blank" rel="noopener nofollow">reserves</a> primarily made up of yield-bearing U.S. Treasury Bills (T-Bills) — a short-term loan given to the U.S. government.
In the fourth quarter of 2023, the company posted a <a href="https://cointelegraph.com/news/tether-posted-record-2-85-billion-profit-q4-driven-treasury-bills">record quarterly profit</a> of $2.85 billion, $1 billion of which came from its T-Bills. Its fourth-quarter report disclosed T-Bills holdings of over $80 billion, and in the past, it&nbsp;<a href="https://cointelegraph.com/news/tether-s-ardoino-says-it-s-now-one-of-top-buyers-of-us-treasury-bills-holds-72-5b"></a><a href="https://cointelegraph.com/news/tether-s-ardoino-says-it-s-now-one-of-top-buyers-of-us-treasury-bills-holds-72-5b">claimed to be&nbsp;one of the world’s top buyers</a> of U.S. government debt.
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 Tether’s Q4 2023 report also said it holds $2.8 billion worth of Bitcoin. Source: Tether
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The quality of the assets backing USDT has been a cause of concern in the crypto space, and Tether has made efforts to <a href="https://cointelegraph.com/news/tether-commercial-paper-exposure-now-under-50m-says-cto">reduce its exposure</a> to some assets deemed higher risk.
Related: <a href="https://cointelegraph.com/news/stablecoins-boost-us-dollar-global-reserve-currency-fed-governor">Stablecoins could boost dollar as global reserve currency: Fed governor</a>
In late 2022,&nbsp;Tether pledged that by the end of 2023, it would stop&nbsp;<a href="https://cointelegraph.com/news/tether-to-reduce-secured-loans-to-zero-in-2023-amid-battle-against-fud">lending out funds from its reserves</a>.
Those plans never eventuated, with Tether having $4.8 billion of loans on its books at the end of 2023, although it’s about $1 billion less than it started the year with. It claims the loans are fully collateralized and <a href="https://cointelegraph.com/news/tether-2023-stablecoin-loans-rise-despite-size-down-plans">promised to cut them&nbsp;to zero</a> in 2024.
Over half of the USDT currently issued is <a href="https://cointelegraph.com/news/tether-wont-confirm-deny-plans-drop-usdt-support-tron">on the Tron blockchain</a>, which a January United Nations report said “has become a preferred choice” for Southeast Asia-based cyber fraud and money launders.
Tether has <a href="https://cointelegraph.com/news/tether-challenges-report-illicit-activity-usdt"></a><a href="https://cointelegraph.com/news/tether-challenges-report-illicit-activity-usdt">hit back at the report</a>, claiming the UN failed to mention the company’s law enforcement collaboration and the token’s traceability.
Magazine: <a href="https://cointelegraph.com/magazine/unstable-coins-de-pegging-bank-runs-other-risks-2023/">Unstablecoins: Depegging, bank runs and other risks loom</a>

Tether’s USDT stablecoin hits historic $100B market cap

Cointelegraph

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