Analyst | Carol Editor | Bi Tongtong
Data Partner | Produced by DAppTotal | PANews
Changes in stablecoins profoundly reflect changes in the market. Stablecoins serve as a hedge for investors when cryptocurrency market prices suddenly plummet. During the violent market volatility last week, USDT accounted for 60%-75% of BTC transactions, and the OTC price of USDT has repeatedly recorded a high premium compared with the US dollar.
Although various stablecoins have been issued frequently recently, the pattern of the stablecoin market has been led by USDT since 2018. The total market share of various USDTs is basically stable at more than 80%, and emerging stablecoins such as TUSD, USDC, and BUSD are not warm. It is not popular, only occupies a small part of the market, and is highly dependent on one or two exchanges for liquidity. In addition, stablecoin chips are still highly concentrated. Although the per capita currency holdings of the TOP 5 have dropped by half, the TOP 100 whales still hold about 70% of the chips.
Although the overall macro market structure has not changed much, there are still some new trends in the stablecoin market that deserve attention recently. For example, in addition to USDT launching "money printing machines" on multiple public chains, emerging stablecoins such as USDC, USDE, and NUSD are also frequently issued. Stablecoins have more connections with DeFi. In addition to USDC taking the lead in entering the lending market, WETH, WBTC, HBTC and other new pan-stablecoins that anchor mainstream tokens also show great possibilities. In addition, new players have entered the market, and stablecoins issued (or jointly issued) by public chains and exchanges have shown a trend of catching up from behind.
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USDT market share rises to 83%
USDT has always been the leader in the stablecoin market. Before September 2018, its market value accounted for more than 95%. However, due to the trust crisis of the issuer Tether and its dispute with Bitfinex, the market value of USDT has continued to decline since October 2018. By January 2019, the total market value of various USDTs had fallen to about 70%. , the lowest point in history. Since then, USDT has started "money printing machines" on multiple public chains. After April 2019, the market value of various USDT has risen to more than 80%, and has remained so far.
According to the latest data, as of March 9, the total market value of OMNI-USDT, ERC20-USDT, TRC20-USDT and EOS-USDT has reached 83.10%, which is about 4.954 billion US dollars.
In addition, USDC occupies the second spot. As of March 9, the market value is about 459 million US dollars, accounting for about 7.70%. Secondly, the market value accounted for more than 1%, that is, PAX, TUSD, BUSD and DAI accounted for more than 60 million US dollars, accounting for about 3.36%, 2.17%, 1.64% and 1.20% respectively.
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Since February, the cumulative net additional issuance of 562 million additional issuances has a weak negative correlation with market sentiment
Since the beginning of this year, various stablecoins have been issued/destroyed frequently. According to statistics, from February 1st to March 9th, a total of 268 additional stablecoins were issued, equivalent to an average of 7 additional issuances per day, and a total of 220 times of destruction, equivalent to an average of 6 daily destructions. Among them, DAI, NUSD, USDC, USDE, and BUSD were issued and destroyed frequently, with a total of more than 50 times, and NUSD and DAI, which had the most issuance and destruction times, reached 76 times. In addition, during this period, ERC20-USDT was only issued additionally, but not destroyed, with a total of 6 additional issuances.
During this period, a total of 1.553 billion U.S. dollars of various stablecoins were issued, a total of 981 million U.S. dollars were destroyed, and a cumulative net increase of 562 million U.S. dollars was issued. Among them, ERC20-USDT accumulated net additional issuance (because there is no destruction, it is actually equal to additional issuance) 740 million US dollars, becoming the main source of market liquidity.
Secondly, BUSD has a cumulative net increase of US$57 million, and USDC has a cumulative net increase of US$18 million. In addition, USDC, EOSDT, USDS, and USDx also issued a net increase of more than 100,000 US dollars.
In addition, the net issuance of other stablecoins has been negative since February. Among them, TRC20-USDT has shrunk by 216 million US dollars, PAX has shrunk by 26 million US dollars, and DAI, NUSD, GUSD and USDE have also shrunk by more than 100,000 US dollars.
The current main function of stablecoins is to act as a trading medium. In order to further observe market liquidity, that is, the potential relationship between the net increase of stablecoins and the market trend, PAData analyzed the net increase of stablecoins and the market panic index of alternative.me[ 1], the higher the absolute value of the value, the stronger the correlation between the two.
According to the definition of alternative.me, the smaller the value of the panic index, the more panicked the market, and the larger the value, the more greedy the market. Therefore, if the net increase in stablecoins is positively correlated with the market panic index, it can be considered that the high net increase is related to greed, and the low net increase is related to panic. Conversely, it can be considered that the high net increase is related to panic and the low net increase Fat is associated with greed. According to statistics, the overall net issuance of stablecoins has no statistical correlation with market sentiment, but the performance of each stablecoin is different.
Among them, the more relevant one is the more transparent decentralized stablecoin USDx. Its net additional issuance amount since February is highly negatively correlated with the average panic index of the first 7 days and the average panic index of the next 7 days. The panic index showed a weak negative correlation. USDx is a stablecoin anchored to a basket of USD stablecoins launched by dForce. Holding the currency can earn income on the lending platform Lendf.Me. The possible reason for the high negative correlation is that when the market is bad, USDx holders choose to provide liquidity for the lending pool to obtain loan income, which is equivalent to obtaining stable deposit wealth management income. However, assets such as DAI and USDC, which can also realize loan income, do not show such a strong correlation.
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Since February, on-chain transactions have exceeded 46.6 billion DAI transactions are highly correlated with market sentiment
From the perspective of on-chain transactions of stablecoins, since February, the number of on-chain transactions of stablecoins has reached 5.23 million times, of which ERC20-USDT alone has reached 3.546 million times, accounting for about 67.8%. Secondly, TRC20-USDT The number of on-chain transactions of USDT, OMNI-USDT and USDC also exceeded 300,000 times.
During the same period, the total transaction volume on the stablecoin chain exceeded 46.6 billion US dollars, and the total transaction volume on the ERC20-USDT chain reached 30.529 billion US dollars, accounting for about 65.51%. The total transaction volume on the TRC20-USDT, OMNI-USDT, and USDC chains also exceeded 3 billion Dollar.
Regardless of the number of transactions on the chain or the transaction volume on the chain, except for ERC20-USDT, TRC20-USDT, OMNI-USDT and USDC, which performed better, the transaction times and transaction volume of other stablecoins are not high .
PAData further analyzed the Pearson coefficient between the trading volume on the stablecoin chain and the alternative.me market panic index. The higher the absolute value of the value, the stronger the correlation between the two. According to statistics, overall, there is no statistical correlation between the on-chain trading volume of stablecoins and market sentiment.
But from the perspective of each stablecoin, DAI is highly correlated, and its on-chain transaction volume is highly positively correlated with the average panic index of the first 7 days, the current day’s panic index, and the next 7 days’ average panic index, which means that When the transaction volume on the DAI chain is high, the market sentiment in the week before and after is relatively greedy, and the situation is similar to sUSD. In addition, the on-chain transaction volume of GUSD is negatively correlated with the average panic index in the next 7 days, that is, when the transaction volume on the GUSD chain is high, the market sentiment in the next week is usually more panic. However, the on-chain transaction volume of ERC20-USDT, which currently accounts for "half of the country", has basically nothing to do with the market sentiment of the previous week.
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The concentration of bargaining chips is greatly reduced, and the source of transaction volume is highly concentrated
As of March 9th, OMNI-USDT has a total of 336,100 currency-holding addresses, ERC20-USDT has a total of 896,700 currency-holding addresses, USDC has a total of 107,400 currency-holding addresses, TUSD has a total of 2.46 currency-holding addresses, and DAI has a total of 37,700 currency-holding addresses Currency holding address. USDT still has a huge lead at the user level.
According to statistics, on average, the TOP 100 addresses of each stablecoin balance hold 70.19% of the total circulation of each stablecoin. Among them, OMNI-USDT, which was issued the earliest time, has the highest concentration of chips, and the TOP 100 addresses account for 87.62% of the total balance. DAI has the lowest concentration of chips, and the total balance of TOP 100 addresses accounts for about 52.57%.
If the scope of giant whale addresses is further narrowed to the top 5 balances, the average holdings of each giant whale account for about 6.35%, that is, an average of 7.8 wallet addresses can control half of the circulation of a stablecoin. According to the statistics of PAData in 2018, this value is about 12.75% (refer to "Data Dialysis: The New Pattern of Stablecoins of "One Super and Many Strongs"), and the current concentration of chips is about half that of a year ago. It can be seen that with the in-depth development of the industry, the user scale of stablecoins has expanded significantly.
What needs to be pointed out here is that both OMNI-USDT and TUSD’s largest giant whale have about 18% of the market liquidity, but the address of OMNI-USDT is Tether Treasury. If these two extreme high values are removed, the stablecoin giant whale’s address The average actual stack percentage may be less than 6.35%.
Although the concentration of giant whale chips has dropped significantly, except for USDT, the transaction volume of stablecoins (the analysis here is the uncalibrated nominal transaction volume) mainly relies on one or two exchanges, and the situation has not improved. This means that, in fact, in addition to USDT having a wide range of transaction medium functions, other stablecoins have obvious limitations when undertaking this function.
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New changes have taken place in the issuers and anchor targets of stablecoins
With the exception of USDT, most stablecoins are deeply tied to individual exchanges, either actively or passively. This makes it a matter of course for the exchange to enter the stablecoin market, and the original stablecoin issuer changed his career to become a stablecoin issuance solution provider. For example, the stablecoin BUSD launched by Binance and PAX, and Huobi has also issued HUSD to convert other USD stablecoins from the transaction entry level. However, judging from the overall performance of the stable currency market, the stable currency of the exchange is not popular, and its development is highly dependent on the transaction business of the exchange, it is difficult to step out of the ecosystem of the exchange, or these stable coins have no intention of stepping out exchange.
Similar to exchange stablecoins, there are also public chain stablecoins, such as Tron’s customized version of USDT and Ontology’s customized version of PAX. It can drive the development of enterprise-level applications, and can also reduce the threshold for ordinary users to use DApp and expand the user base. But at present, whether it is TRC20-USDT, EOSUSDT or ONT-PAX, the energy brought to the public chain is still very limited. The market value of TRC20-USDT has declined slightly recently, and it does not explode like ERC20-USDT.
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[1] Alternative.me’s panic index is quantified from Bitcoin-related data, including volatility (25%), trading volume (25%), survey results (15%), social media text analysis (15%), market Share (10%) and Trend (10%). But Bitcoin is the dominant currency in the current cryptocurrency market, accounting for more than 60% of the market share. And according to previous correlation analysis, the rise and fall of Bitcoin's currency price is highly positively correlated with the rise and fall of other mainstream currencies such as ETH, BCH, XRP, and EOS. So this index is also suitable for observing the sentiment of the entire cryptocurrency market.
