Stablecoins: The Digital Asset of Choice in an Uncertain Market

• Stablecoins are gaining popularity due to their stability against cryptocurrency volatility.
• There are currently 37 billion stablecoins held in reserves of cryptocurrency exchanges, with Binance having the highest reserve.
• Following the collapse of FTX, 3.93 billion stablecoins have left exchanges in the past 30 days.

The industry of cryptocurrencies is growing steadily, and alongside it, is the growing strength and popularity of stablecoins. These digital assets offer a much-needed stability against cryptocurrency volatility, and have become a popular choice when it comes to digital asset investment. At present, USDT is the largest stablecoin by market cap, followed by USDC, Binance USD, and DAI. Together, they make up the big four stablecoins which have a collective market cap of $138 billion according to CoinMarketCap.

When it comes to exchanges, only a small amount of stablecoins are held in reserves. Binance currently has the largest reserve of stablecoins, with more than $24 billion in its reserve. Coinbase has more than $973 million, Huobi $709 million, Bitfinex $145 million, Gemini 98 million, and $78 million.

Unfortunately, following the collapse of FTX, there has been market uncertainty and low trust in centralized exchanges. Consequently, in the last 30 days, 3.93 billion stablecoins have left exchanges. This is a sign that investors may be losing faith in centralized exchanges and looking for more secure storage solutions.

It remains to be seen whether stablecoins can truly be a safe haven against cryptocurrency volatility and whether the collapse of FTX will have a lasting impact on the trust of centralized exchanges. It is clear, however, that stablecoins are here to stay and are becoming an increasingly popular digital asset class.