The stable asset such as fiat currencies pegs the value of stable coin in the arena of cryptocurrency trading. Among the most popular stable coins come USD coins (USDC), Tether (USDT), and Binance USD (BUSD). All these three stablecoins have a market cap of $60 billion while combined. Stablecoins are attracting crypto investors with their low-fee, fast and safe transactions. Moreover, users are free from any financial and location-based limitations as stablecoins operate over blockchain technology.
Furthermore, by 2023 the worldwide blockchain market will reach $23.3 billion. Such estimates prove the potential of cryptocurrencies across the globe. Though stablecoins are more stable and reliable than any other cryptocurrencies, which stable coin to choose is confusing. All three USDT, USDC, and BUSD are potentially great investments.
Hence, in this article, we will learn about all three stablecoins in detail. Further, we will see how they differ from one another.
Table of contents
- What do you need to know about Tether (USDT)?
- What do you need to know about USD Coins?
- What do you need to know about BUSD?
- What are the differences between USDT vs. USDC vs. BUSD?
- In terms of Blockchain platforms
- In terms of Stability
- In terms of Stablecoin Supply and Volume
- Closing Thoughts
What do you need to know about Tether (USDT)?
USDT is a stablecoin with an intent to stabilize the valuation of cryptocurrencies. Additionally, it can become a reliable means of transactions and a valuable storage mode. Its stability over some of the popular cryptocurrencies makes it a better investment.
Furthermore, USDT specifically focuses on building a bridge between cryptocurrencies and fiat currencies. In addition to this, it also offers transparency, nominal transaction fee, and more stability to users. It operates on the Tether blockchain platform.
What do you need to know about USD Coins?
This stablecoin has a US dollar pegging its value. Hence, it diminishes the volatility of its coins. Further, it aims to make transactions affordable and quicker in contrast to traditional online payment systems.
The dollar-denominated assets with a similar value as USDC in circulation support the coin. You can purchase USDC using exchanges such as Coinbase. Further, you can store it in a digital wallet compatible with Ethereum.
Moreover, users can easily redeem USDC in the form of US dollars that have the same market value. As per the data of August 2021, the minting count for USDC is now over $20 billion.
What do you need to know about BUSD?
The US dollar secures the BUSD coins. Fiat currency regulates and supports the BUSD stablecoins. Moreover, a US dollar is held in reserve for each BUSD unit in the market. In easy words, it means the BUSD supply is secured to the one-on-one ratio to the US dollar. In addition to this, it allows holders to exchange their tokens for fiat currency. Further, every month, the Project owner releases the BUSD reserve audits.
BUSD works to maintain a steady market value. Also, it lets traders and investors store more stable coins on the blockchain platform without needing them to leave the crypto domain.
What are the differences between USDT vs. USDC vs. BUSD?
Though all three of them have almost similar principles and goals, they differ significantly. Here are some basic differences between USDC, UTSD, and BUSD to help you understand them better. However, a certified cryptocurrency expert can give you in-depth knowledge about their similarities and differences.
In terms of Blockchain platforms
One of the critical distinctions between the three stablecoins is their blockchains. A blockchain is a framework that records exchanges using changeless cryptographic signatures. Further, this eliminates or limits the danger of hacking or fraud within the framework.
Plus, distinctive blockchains bring about an assortment of benefits, like more utility and speed of exchanges. Where USDT just operates on a solitary blockchain, BUSD and USDC have numerous blockchain choices. Further, this permits purchasers to exchange and trade across the blockchain platforms.
In terms of Stability
The stablecoins accomplish their value stability through collateralization of purchasing and selling the reference asset. However, they might fluctuate somewhat from the cost of their token. Then, they progressively return to their initial worth. USDT’s Stability is more dependable as the stablecoin manages to stay consistent at $1.
Essentially, USDC and BUSD are likewise steady at $1. Notwithstanding, debate surrounding the claim by Tether of having adequate dollar reserves is still going on. Many investors and economists speculate that Tether does not have such dollar reserves.
Stablecoin Supply and Volume
The volume of a stablecoin alludes to the absolute exchanges happening. While liquidity alludes to the quantity of coins accessible for trading at the set value. Usually, the set value is $1. Further, with the increase in the volume, generally, the liquidity does increase as well.
A stable coin having a high volume makes it simpler for investors to perform transactions. As per the record of 30, 2021, the USDT trading volume is 75 billion, ranking it higher than the USDC and BUSD.
Moreover, USDC maintains a volume of 2.7 billion, while the BUSD stablecoin maintains a market volume reaching 5.8 billion. Additionally, the total supply of stablecoin is estimated at around 116B.
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Among the three currencies, USDT maintains the title of the biggest stable coin in terms of market cap. It has a total circulating supply of more than 65.49B USDT. On the other hand, the circulating supply of BUSD is 12.25B, and USDC has around 27.37B UDSC supply.
If you want to invest in the stablecoin market, then USDC, BUSD, and USDT are the best options. By acquiring nearly 93% of the total market cap of stablecoin, they can give the best returns. More and more businesses are now planning to adopt stablecoins for transaction processing. With the increasing popularity, the future of stablecoins looks brighter. Hence, if you are about to try out a stable coin investment, choose the three above-mentioned coins.
Get more information on the blockchain, bitcoins, and stable coins at the BLOCKCHAIN COUNCIL. With this platform, you get access to multiple blockchain courses with its cryptocurrency certification consortium.