Stablecoins 'Flip' Ethereum's Native Currency in Transfer Value

A greater share of value is being transferred via stablecoins over the ethereum network than its own native cryptocurrency.

AccessTimeIconJan 30, 2020 at 4:21 a.m. UTC
Updated Sep 13, 2021 at 12:13 p.m. UTC

A greater share of value is being transferred via stablecoins over the ethereum network than its own native cryptocurrency ether (ETH), according to research conducted by crypto data aggregate Messari.

In a recent tweet, Ryan Watkins, research analyst at Messari, said stablecoin transfer value had “flipped” ethereum’s native currency, ETH.

“This is largely the story of tether (USDT) transitioning to ethereum. On a weekly basis, the flip occurred mid-2019. Since then the change is striking,” Watkins said.

The outstripping of ETH by stablecoins on its own network signifies a major step towards trust in cryptocurrencies whose values are pegged 1-to-1 to a major currency like the U.S. dollar.

The ethereum network allows for numerous tokens to operate within its ecosystem amid the backdrop of interoperability, enabling seamless transactions between multiple parties.

ERC-20 stablecoins, however, are by far the most sought-after token on the ethereum network in part largely due to the rise of the U.S. dollar-backed stablecoin USDT, as Watkins notes.

CoinDesk - Unknown

ETH + ERC20 Stablecoin Weekly Adjusted

USDT flipped ETH sometime during the months of April and May 2019, with the transfer value outstripping ethereum’s native token and USDT maintaining its dominance ever since.

The company behind the stablecoin, Tether Ltd,  began migrating tokens to ethereum in April 2019.

A few months later, the amount of USDT on bitcoin’s Omni layer started rapidly declining. Tether has since started issuing new tokens on the Tron and Liquid blockchains, with an influx of USDT in November 2019 far outstripping ETH.

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Trending

1
CoinDesk - Unknown
Hard Times in Crypto: the Unintended Consequences of Going Public

The third and final reflection on a series of risks we’re thinking about during these crypto down days.

CoinDesk - Unknown
2
CoinDesk - Unknown
After Bitcoin Maximalism

A Twitter debate sparks much reflection.

CoinDesk - Unknown
3
CoinDesk - Unknown
Three Arrows Paper Trail Leads to Trading Desk Obscured Via Offshore Entities

As Three Arrows Capital collapsed under market pressure, its much-lesser known trading desk, TPS Capital, remained active, sources say. But a complex ownership structure might frustrate creditors' efforts to collect.

CoinDesk - Unknown
4
CoinDesk - Unknown
June Was Bitcoin’s Worst Month Ever

Plus, European crypto regulation comes into view.

CoinDesk - Unknown