Stablecoins Take Over the Ethereum Network

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Native Cryptocurrency no Longer the Most Popular on Ethereum Blockchain. The Ethereum blockchain was built to facilitate trading for a range of tokens, but the native Ether was always the most heavily-traded. Tether has now surpassed Ether on the blockchain and is now responsible for the largest share of the trading volume. 

For a long time, the Ethereum blockchain has been trading various cryptocurrencies, but the most significant percentage of their value came from Ether, the crypto coin native to the blockchain. But since mid-2019, stablecoin has become the largest share of value being traded on the blockchain, and the trend has remained the same, only widening the gap in value between Ether and stablecoin. 

Try Out New Tether Trading Account

Stablecoins are a relatively new type of cryptocurrency, where their value is tied to another, more stable asset, such as gold or the USD. This is used as an attempt to reduce the volatility of price swings that cryptocurrencies are used to. The most popular stablecoin, Tether, is responsible for the majority of the stablecoin trading on Ethereum.

Tether has now debuted Tether Gold

In the wake of their stablecoin success backed by real currencies, Tether has now also branched out and created Tether Gold. Each Tether Gold stablecoin is equivalent to one troy fine ounce of real gold. Tether Gold tokens are backed by real gold sitting in a Swiss vault, meaning that it is highly unlikely they will experience the volatility that can be found in more traditional cryptocurrencies. Tether Gold represents the digitization of physical gold and makes it more accessible to investors. One of the factors that make investing in gold inconvenient is the fact that it involves high storage costs, to keep the gold safe. Tether is not charging any fees of this kind, making this form of digital gold a cheaper investment in the long run, while still retaining all of the benefits of physical gold. 

What does the flip mean?

The flip from native cryptocurrencies to more secure stablecoins creating the most trading value on blockchains might be indicative of a more significant shift in focus. People are moving away from potentially volatile cryptocurrencies like bitcoin and Ether, to something more robust, backed by real-world value in the form of gold or currency. There is less risk with an investment like this, as it has a guaranteed amount. Small business owners are now using Stablecoins, such as tether, in some places in the United States. 

Trade with Stablecoins

It is also possible that the flip may cause traffic issues for blockchains. When stablecoin trading first began to increase trading on Ethereum (shifting from Bitcoin’s Omni layer), the blockchain was initially not equipped to cope with the excess activity. Since that point, the blocks have increased in size to make way for higher trading value, and there have been no issues since. But it is possible that if Tether continues their exponential growth, that they may outgrow Ethereum yet again. If this occurs, it is also possible that this time, the necessary infrastructure will not be developed fast enough to facilitate all of the essential tradings. 

Stablecoin accounts on SimpleFX

You can benefit from the stablecoin payments trading with SimpleFX. We have Tether accounts available. You can not only deposit and withdraw funds using Tether ERC20 or Tether Omni networks. Give it a try now.

 

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