Stablecoins face uncertainty amid bull market frenzy

There hasn’t been a meaningful increase in the overall value of stablecoins during the recent bullish cryptocurrency market, a Six Degree study has revealed, with the Ethereum stablecoin seeing a 34 percent decline in value compared to last year.

The analysis also reveals a more detailed perspective on the dynamics and distribution within the Ethereum platform. Facing an ongoing decline since 2022, Ethereum currently stands at $69.4 billion overall. The dynamics of these assets reveal patterns.

It shows that half of the stablecoins on Ethereum are held in personal wallets, making up 30 percent of centralized exchanges (CEXes) but only 5.5 percent for decentralized finance (DeFi). This marks a significant shift from January 2022, when DeFi protocols accounted for 25 percent of Ethereum’s stablecoins.

Leading Ethereum stablecoins, including USDT, DAI, and USDC, have seen diverse shifts in their market trends. USDT has a relatively stable price with a 23 percent increase, while DAI has seen a 30 percent decrease, and USDC has a 47 percent decrease in its price value.

For the record, Ethereum (ETH) itself currently stands at $2,264.97, representing a 0.83 percent decrease over the past 24 hours. Its monthly analysis shows an 8.78 percent increase, and its yearly gain stands at 87.62 percent, according to data from CoinMarketCap.

Tron being an exception

Tron, on the other hand, shows a different dynamic, with 30 percent of its stablecoins presently existing on central exchanges, but only 0.2 percent are associated with DeFi projects.

The cryptocurrency has shown promising growth this year, with its user base expanding by approximately 40 percent. This resulted in a weekly stablecoin usage of $5 million for Tron in the first half of 2023, leading to substantial transaction volumes of $70 billion every week. Tron’s cost and efficiency benefits have also boosted its adoption, surpassing Ethereum stablecoins, particularly in Latin America.

It bears mentioning that Tron has seen a minor 1.3 percent drop in the past 24 hours and a monthly drop of 0.33 percent as of December 26 at $0.1059. Despite this, its overall performance in a yearly analysis shows an impressive 93.36 percent increase for the year 2023.

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