A sharp sell-off across the cryptocurrency market Tuesday—that saw top tokens like Bitcoin (BTC), Ether (ETH), Cardano (ADA), and Solana (SOL) fall by double-digital percentages—created a venue for stablecoins to prove their worth.
The fixed-price cryptocurrencies offered interim protection to traders from the notorious crypto price volatility. They did so by almost maintaining their one dollar-peg and offering sufficient liquidity to traders that looked for a safety net during the market decline.
Blockchain analytics service CryptoQuant reported dramatic spikes in the stablecoin transfers as the cryptocurrency market cap fell from $2.38 trillion to $2.103 trillion on Tuesday.
For instance, Tether, the leading stablecoin by volume, processed $10.51 billion worth of transactions on Tuesday compared to $4.02 billion on Monday.
The mean of all stablecoins transfer. Source: CryptoQuant
Similarly, the second-largest stablecoin USDC, backed by Circle, reported $5.728 billion worth of transfers on Tuesday versus $3.27 billion in the previous session, logging a 74% spike.
At the same time, the net stablecoin supply in circulation