The stablecoins like USDT, USDC, etc experienced a wider adoption throughout the year 2022 as the bear market restricted the rally to a large extent. However, as 2023 began with a kickstart of giant price action, the demand for these stablecoins dropped. Therefore, the dominance of these tokens is plunging by a huge margin and presently testing one of the important support levels.
Moreover, the strength of the rally also appears to be extremely weak and hence it may result in an explosive move toward the south. Moreover, the Trend Breakout Indicator(TBO) substantiates the weakening of the rally as it indicates the beginning of a deep bearish trend.
The combined market cap of the top 2 stablecoins has plummeted from around 15% and currently hovering just above 10%. If the levels fail to sustain above these crucial levels, then a continued downtrend may slash the combined market cap below 10% to reach 9.69%.
However, considering the individual market cap of both USDT and USDC, the USDC market capitalization has been slashing hard and faced rejection from $70 billion to drop below $65 billion. Meanwhile, the USDT’s market cap has been witnessing significant growth in the past week rising from $66.29 billion to reach levels just above $68 billion.
Therefore, it can be considered as the market participants are again betting on USTD as the USDC’s market cap is plunging comparatively. Therefore, the USDT is believed to maintain its dominance against USDC while the bullish market sentiments may prevail for the cryptos in the longer term.