Despite inflating at spot rates, Tron was not spared the wrath of bears after reaching its peak in February. Like other altcoins such as Solana and ethereum, whose prices soared to 2024 highs in March, Tron remains in the red in the past month of trading and is yet to conquer recent peaks.
As TRX and eth try to reverse recent losses, something else is going on: on Tron and ethereum, demand for USDT, the world's most valuable stablecoin, is rapidly falling.
USDT minting activity on ethereum and Tron drops from $7 billion to $1 billion
An analyst at x x.com/AxelAdlerJr/status/1807696461557116965″ target=”_blank” rel=”noopener nofollow”>noted that declining minting activity, and therefore overall blockchain utilization on both networks, has caused USDT issuance to drop from $7 billion to just $1 billion in early July.
This drop, which reflects the price contraction in June, points to lower trading activity and plummeting demand for cryptocurrencies during that period.
Despite ethereum being dominant, Tron is the preferred network for users looking to mint USDT. Unlike the world’s first smart contract platform, Tron is scalable and its transactions are inexpensive.
Progress has been made in ethereum’s scalability. The emergence of over a dozen ethereum layer 2 platforms, such as Base and Arbitrum, helps cement its position as the largest ecosystem.
Related reading: Sony enters the cryptocurrency market with the acquisition of Amber Japan
While gas fees have been decreasing over the months, developers have made significant strides in making layer 2 transactions much cheaper through upgrades like Dencun.
Thanks to this update, users who would otherwise mint tokens like meme coins or stablecoins on Tron can choose to do so on ethereum layer 2 solutions like Arbitrum.
The drop in USDT minting on ethereum and Tron suggests that the demand for cryptocurrencies is decreasing. Typically, whenever there is a massive minting of USDT, bitcoin and cryptocurrency prices tend to rise.
Therefore, until USDT minting activity resumes on these major smart contract platforms, the prices of bitcoin and major altcoins will likely remain suppressed.
Tether partners with Uquid and stops minting cryptocurrencies on EOS and Algorand
On July 1st, Tether x.com/Tether_to/status/1807685715217506410″ target=”_blank” rel=”noopener nofollow”>hands together with Uquid to improve payments in the Philippines using the TON blockchain. The goal is to modernize payment processes for the Southeast Asian government's Social Security SystemBeyond this, the goal is to make payments safer, faster and more efficient.
As Tether, the issuer of USDT, establishes more partnerships, so too Announced the completion of USDT minting on the Algorand and EOS networks. However, USDT redemptions will continue throughout the next year.
Although EOS and Algorand are no longer available, USDT can be minted on more than ten platforms. CoinMarketCap says More than 110 billion dollars of the token has They have been minted cumulatively.
Featured image from Canva, chart from TradingView
