The emergence of DeFi protocols and the demand for tokens in liquidity pools can significantly increase the supply of stable coins.

According to a September 3 tweet from Coin Metrics co-founder Nick Carter, the current stable supply is Binance USD (BUSD), Dai (DAI), HUSD, Paxos Standard Token (PAX), USD Coin (USDC), USDK and Tether ( USDT). And USDT_ETH and USDT_TRX grew by almost $ 100 million a day for about two months.

“Everyone was very excited about DeFi, and no one pointed out that stable coins added $ 100 million a day since mid-July,” Carter said. “It is clear that DeFi interest rates / returns are a vacuum that sucks in many stable currencies.”

Stable currencies are very popular among tokens used in the DeFi Protocol’s liquidity pools, which have appeared in greater numbers than ever this year, and provide more and more profit in the competition to raise blocked funds. DAI and USDC are also the most lending and borrowing of stack coins in the composite protocol, and they are also the two most stack coins borrowed from Aave.

However, Altether still dominates the stablecoin market at 80%. According to CoinMarketCap, Tether’s total market value has increased from $ 9.2 billion on July 15 to over $ 13.7 billion today, an increase of almost 50%. USDT trading volume has increased by almost 150% over the same time period from $ 21.9 billion dollars to over $ 54 billion dollars at the time of writing.

The organizers are starting to notice this as well. Andrew Bailey, Governor of the Bank of England, said today that stable currencies could offer some “beneficial benefits” to UK investors, such as reduced payment friction, but warned that currencies “should have standards similar to those used today for others”. forms of … currency. “Payment and forms of money transfer through it. Bailey also pointed out the need for internationally agreed provisions on stable currencies:

“A global stable currency is a cross-border phenomenon. It can operate in a jurisdiction, is denominated in another currency and used by consumers in a third country. The regulatory response should be in line with this. ”

Source: CoinTelegraph