Tether (USDT), the embattled cryptocurrency token whose value is purportedly backed by US dollars, continues to see massive outflows as it struggles to maintain USD parity amid rising competition from other stablecoins launched by some of the crypto industry’s biggest names.
Blockchain data from Omni Explorer shows that yesterday, on Oct. 30, Tether Limited redeemed another 100 million units of USDT, reducing the outstanding supply to about 1.8 billion.
Since the beginning of October, Tether has redeemed a staggering 990 million tokens, more than double the 452 million that were in circulation on this date last year. Coupled with the fact that the USDT price is currently trading at a discount to its supposed $1.00 valuation, tether’s market cap has dropped by more than $1 billion this month and more than 37 percent from its all-time high.
On Wednesday, tether, long the eighth-largest cryptocurrency by market cap, slid behind cardano (ADA) to ninth, weighed down by its price once again dropping below $0.99 after briefly touching $1.00 earlier in the week. USDT now maintains less than a $100 million edge on 10th-ranked monero (XMR).
Curiously, Kraken’s USDT/USD market, which allows traders to exchange tokens fiat USD, is actually, as of the time of writing, trading at a slight premium to tether’s global average price. The trading pair, which has $15 million in volume over the past 24 hours, had in recent days consistently priced USDT several percentage points below its global average.
Meanwhile, tether’s competitors — particularly TrueUSD (TUSD), USD Coin (USDC), and Paxos Standard (PAX) — continue to see rapid growth in the wake of USDT’s lost dollar peg. Collectively, the market caps of these three stablecoins now exceed $400 million, and while that does not completely account for the nearly $1 billion in tether outflows, it does suggest that traders view these “regulated” tokens as more trustworthy than USDT, whose issuer has been criticized for its opaque operations, banking relationships, and association with cryptocurrency exchange Bitfinex.