Tether’s dominance in the cryptocurrency market has surged, reaching its highest point since April, highlighting the risk aversion present in the broader crypto landscape.
Tether is the largest dollar-pegged stablecoin globally, with a market capitalization of $184 billion at the time of writing. While it is primarily used for facilitating crypto transactions, lending, and borrowing, it also serves as a dollar equivalent, acting as a preferred store of value during market volatility.
Investors often shift their funds to USDT and other dollar-pegged stablecoins when the market weakens. Recently, the crypto market has faced challenges, with market leader Bitcoin experiencing an 11% decline this month to $97,630.
Historically, bear markets have been accompanied by significant increases in Tether’s dominance as traders seek to protect their capital. The beginning of these bear markets frequently coincides with a resurgence in USDT dominance, as indicated by the MACD histogram crossing above the zero line.
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