USDT: a point-to-point electronic cash system

In 2008, a paper called "bitcoin: a peer-to-peer electronic cash system" came out of nowhere. For the next 12 years, bitcoin held the promise of a new form of payment, but it failed. Today, we have a new alternative, the USDT, which is showing signs of being the new way to pay, the point-to-point electronic cash system.

In two months, USDT raised nearly $5 billion, giving it a market capitalization of more than $9 billion.

At the same time, the market value of the stable currency sector exceeded 10 billion us dollars.

Coin letter issue USDS, enter the stable currency market; Paypal financial has plans to make stable currency; Sun yuchen in Defi fire last year when indifferent, but this year in the trc20-usdt crazy additional circumstances, still launched USDJ stability currency.

But behind this, BTC did not record, in addition to 312 in the extreme market under the influence of the global environment, COINS from 2018 to now has been constantly hovering around $ten thousand, industry investors are not visible to the naked eye, like it did in 2017 since the amount and the audience did not increase, then why are stable currency without foundation to raise so much?

In order to explore the deeper reasons behind this, BlockBeats summarized the flow pattern of USDT secondary issue and interviewed a number of people related to the stable currency field, and reached a surprising conclusion: the stable currency will exist completely independently of the cryptocurrency industry. In the near future, the stable currency will become higher and higher, and even surpass bitcoin.

More extreme, even if bitcoin goes to zero, a stable currency led by the USDT will still exist, which will inherit nakamoto's legacy and become the peer-to-peer electronic cash system.

The USDT market of the future will be larger than all cryptocurrencies combined today.

The phenomenon of

From May 1st to 14th, the big hand of market macro-control, Tether, struck another 1.36 billion USDT, worth $1.36 billion, with a stroke of his pen. In less than two months, Tether minted nearly 40 new COINS.

How fast is that? You can see these two data from CMC: the current total market value of USDT is over $9 billion, but in 2017, this number is only about 100 million. In other words, Tether can issue three market values of 2017 within 24 hours, and its market value has achieved a 90-fold leap growth in just three years.

This is not news, the industry has discussed a wave of the current consensus conclusion is probably: the biggest winner of the stable currency, and the USDT as a representative of the stable currency trend out of the application.

With the price of bitcoin slowly rising, coupled with negative oil price, Defi stolen and other historical emergencies, people have become accustomed to the issue of stable currency, but the stable currency has not stopped. Not only USDT, but also PAX, HUSD, USDC and other stable COINS are being issued.

We were increasingly asking, where did all this money go? BlockBeats, with a great deal of curiosity, has demonstrated the bold conjecture that the stable currency has become the biggest use of cryptocurrency, beyond bitcoin.

Let's look at the phenomenon first, which is also a clue. We pay attention to the following three phenomena:

First of all, USDT has been issuing additional shares frequently in the past three months, which is characterized by high frequency of additional shares and huge amount of additional shares, with an average of nearly 100 million dollars. During the whole month of April, Tether issued 24 additional usdts, including 1.26 billion USDT of ERC20. In may, Tether turned to the wave field and issued more than 1.1 billion USDT. What's the concept? It means that Tether "printed" the equivalent of a unicorn company every month.

Source: Dapptotal  & have spent

If the time dimension is elongated, the situation of this kind of additional issue, already appeared on the horizon in February. From the perspective of frequency, after the market of "312" dropped sharply, Tether significantly accelerated the issuing speed. At the beginning, Tether was relatively convergent. At the beginning, it was issued 60 million shares, but later it was changed to 120 million shares, or even 180 million shares.

Let's look at the flow. What is unusual is that the USDT's flow is too concentrated on a few trading platforms.

Previously, security firm Beijing lianan had tracked the additional USDT issued in March, and found that more than 80 percent of the 2,206 USDT issued were transferred to the two platforms.

For investors who have been in the coinage for years, the USDT placement has been accompanied by a rise in the price of bitcoin. Previously, USDT additional news out, the basic industry default for the pull disk signal. But now the ratio of USDT to bitcoin is at an all-time high.

Now, is it only the USDT that is being issued? Isn't. The stable currency of USDC and PAX is being issued, and its overall market value has reached 10 billion dollars.

And that's not all. There are new teams on the ground.

Currency letter announced the launch of USDS stable currency, which is a kind of dollar stable currency based on BTC acceptance value, officially entered the field of stable currency.

Paypal financial, one of the industry's biggest lenders, has also signalled a move into stability, though not yet in a position to do so.

Sun yuchen's wave field has suddenly increased the issue of trc20-usdt this year, and its market value has exceeded the wave field, which is not enough. Sun yuchen suddenly entered the Defi field and launched USDJ stability coin in imitation of MakerDAO.

Finally, how much enthusiasm is left in the current cryptocurrency secondary market? Let's see how many new COINS we have now. MASS, Solana, HIVE and so on. Recently, some famous new COINS seem to be able to be counted on two hands, which is far less glamorous than the initial period of scrip financing on the exchange platform last year.

How about contract volume and open positions? It is far from the exciting and surprising spectacle of February this year.

So, the USDT, the USDC, the PAX, the USDT, the new stable currency players, the new stable currency players, who is using the newly printed money?

Or to clarify the question a little more: are these additional stable currencies being used to transfer assets? With questions, we asked some participants.

Firecoin seems to be playing the role of total distributor and Chinese users are the most important

"Eighty percent of the stable currency trading is on fire." As an OTC trader in contact with both institutional traders and Tether, bai xiao can directly sense the obvious changes brought about by USDT issuance.

In march of this year, his trading volume reached a rare level of tens of millions, charging 5 percent per U to earn five figures per day. Similarly, Lin fan, another OTC trader, has a similar experience: "the trading volume of firecoin OTC products has increased by at least 30 percent."

Bai Xiao tell rhythm BlockBeats, raise the stability of the currency from printing money to flow into the market process, basic according to this path: OTC business after receiving or judgment of market demand for USDT, and one of the few global Tether release agent to butt, get hand USDT, deposited in the trading platform or other wallet address, again through a variety of ways to sell to organizations or individuals, eventually flow into the market.

"The role of fire COINS is kind of like a general dealer," he said. "a lot of people buy them from fire COINS and sell them from OKEx and OKEx." As we have learned, at present, the trading platform on the market legal currency trading zone is basically divided into two categories.

First, it is outsourced to agents. The platform only provides a display window. Due to the different habits of users at home and abroad, payment partners have different choices. The other type is platform self-operation, in which platforms recruit OTC merchants to settle on their own.

According to qkl123's USDT off-exchange discount premium data, the USDT has been in positive premium since early February through early may, and in particular reached a record high of nearly 15% in mid-march this year.

"The USDT was really out of stock." Bai xiao recalled that at that time, Tether had just started to increase the issuing speed of USDT, but did not expect that, after the occurrence of huge market fluctuations, the market was still in short supply of USDT, the leverage rate of fire currency could reach 1/1000 per day, "extremely high".

Yang zhou, CEO of paypal financial, expressed a similar view. "there is a lack of legal currency supply in the market," he said. In Yang's opinion, bitcoin has fallen so fast that there is not enough legal tender supply to take it on.

It cannot be denied that some of the newly issued USDT has entered the market. After all, from the perspective of the USDT balance of the trading platform, the daily balance is increasing, and users may hold the USDT and wait for the opportunity to buy. Or if USDT margin contracts start to trend, these could be where the demand for stable currency flows.

But that doesn't fully explain our biggest question: does the market really need so much money? Is it really all going into the cryptocurrency secondary market?

Each additional issue, USDT shipments increased

Lin fan mentioned an interesting phenomenon, "since march, every time USDT additional, I will receive an increase in orders, the increase rate is very big, about 50%."

Lin fan's customers are generally repeat customers, long-term cooperation, each other have WeChat, we need to trade on WeChat contact. But starting in March, Lin fan received some orders are not regular guests. "My average daily transaction volume is 1.6 million USDT. Starting from march, I clearly remember that after each additional issue, the orders for USDT would surge, increasing by about 600,000 to 800,000, and these customers were all occasional."

Every time there's an issue, someone sells the USDT, and they convert the USDT into renminbi. This is clearly not normal: there must be some USDT that does not flow into the secondary market, but has other applications.

This is not the first time that a stable currency has been used outside the currency circle. The USDT has been used outside the currency circle since 2017.

Yujun, founder of cross-border payment platform Qbitpay, told us that the stable currency has been very mature for clearing and settlement in such fields as xihai e-commerce and xihai games. Recently, Qbit's trading volume has increased by 50% every month.

In addition, the transfer of assets with the stable currency this road, has already run through.

Stable currency domain personage Lin fu looks, additional USDT is not used to buy BTC originally, also won't boost currency price to rise, a lot of USDT flowed outside the circle. "USDT is a collection of ash. "

One online gaming platform has already used usdt&cake; & have spent

According to his knowledge, the USDT is now accepted as an important payment method by Internet businesses such as online spinach, live tipping, and even the underground Banks he comes into contact with. We conveniently opened a spinach website he sent, found that indeed support USDT and other stable currency recharge, as we all know, the world's largest online adult website Pornhub also support USDT.

Compared with PayPal and credit CARDS, the former has a poor user experience, while the latter is easy to be stolen. USDT's "advantage" is more obvious: it has no geographical restrictions and is beyond the scope of regulatory control.

These out-of-the-loop use cases are becoming a broader use of the USDT than for speculation.

"The consensus on ash production is strong and the USDT stock is estimated to exceed $20 billion this year." At $7 billion, the USDT's current market value could at least double that estimate, Mr. Lin said.

A bold guess

"A peer-to-peer electronic cash system," is the title of a white paper on bitcoin. Bitcoin was originally intended to be a payment tool, but now, bitcoin is not supporting the world of payments. The nature of bitcoin has evolved from digital gold to a commodity, a commodity that in the eyes of speculators has the same trading properties as oil and gold. Would you buy something with crude oil? Surely not.

And the stable currency represented by USDT has taken on the business of cryptocurrency payment, supporting a piece of sky.

The epidemic has dried up the secondary market liquidity of all kinds of assets around the world, and people are eager for cash to be king. During that period, China's secondary market was almost the best performing in the world. The unlimited printing of dollars may have raised many concerns about America's sovereign creditworthiness. China, the country with the best control of the epidemic, seems to be a good place to stay. The future of RMB is more promising than the us dollar.

Much of the new money in this historic offering is likely to be used for asset transfers, converting foreign assets into dollars, then dollars into USDT and then renminbi on the trading platform.

, some people think that USDT BaoLei because not 100% anchor the dollars, in fact, whether $100% anchor has not important, it was once BaoLei, but survived the market capitalisation of $9 billion, fully illustrates a problem: it has done the currency could not do, now block chain industry's largest ones with application, not the currency, but a stable currency. Bitcoin is no longer a payment, it is a commodity, and the USDT is now recognized as peer-to-peer electronic cash.

The story of the stable currency is still unfolding.

If you want to reprint, please attach this article hyperlink:https://www.theblockbeats.com/news/16481

Welcome to join the official BlockBeats community:

Telegram Subscription Group: https://t.me/theblockbeats

Telegram Discussion Group: https://t.me/BlockBeats_App

Official Twitter Account: https://twitter.com/BlockBeatsAsia