Ask any crypto holder if they own Tether tokens (USDT), and the answer will likely be yes. Perhaps you even have some of this wonderful token. But do you know how much USDT is in circulation? Have you wondered what the USDT market cap is?
Most things in life have a grey area or a buffer of sorts, and in the cryptocurrency world, it’s stablecoins. These are digital currencies that exist on blockchains but are not as volatile or independent as other cryptocurrencies. Stablecoins are tethered to some other form of value like gold, fiat, etc.
USDT is a stablecoin that functions as a digital currency by design but is tied to the value of the US dollar, a fiat currency. The coin has grown in popularity and size since its inception in 2014. Today, we will discuss how USDT is in circulation and determine the market cap. Let’s dive in, shall we?
What is USDT?
USDT is a digital currency that was created by Tether. It is known as Tether USDT and is a stablecoin or token whose value is pegged to 1 US dollar. Simply put, 1 USDT equals the value of 1 USD. Three persons founded Tether in 2014 – Reeve Collins, Brock Pierce, and Craig Stellars
Tether, the issuance company of the USDT token, keeps the token equal to the value of the US dollar by keeping a reserve at all times that is equal to the market cap, i.e., the value in dollars of the number of tokens in circulation.
If, at any point, the value of the fiat and fiat-backed assets in the reserve drops or increases, it causes a deviation in the value of 1 USDT. For example, Blockworks discussed the price history of Tether and revealed that the token deviated to $0.57 on March 2, 2015, and to $1.32 in July 2018. Since USDT is supposed to be a stablecoin, these deviations are not meant to occur. While the value may shift from time to time in negligible spades of $0.01 to $0.02, it should remain at the value of $1 approximately.
How does USDT work?
Tether USDT is a transition point for crypto traders from fiat to cryptocurrencies and vice versa. Some traders and investors also use it to stay on the fence – their coins stay safe from whatever hits the crypto market might be taking without leaving the market entirely.
Think of it this way- as a USDT holder, you can get other coins whenever you want while still maintaining the value of your original investment.
Tether USDT exists on other blockchains like Ethereum, Omni, Solana, Tron, Polygon, and others since the creators didn’t create a blockchain for it.
How Much USDT is In Circulation?
Currently, there are 83.5 Billion USDT in circulation. USDT’s market cap is also $83.5 Billion. This figure is the same as the number in circulation because its value equals the value of the US dollar.
The number of a particular coin in circulation refers to the number that has been mined or released by the creators or sustainers of the currency. Take Bitcoin, for instance. The number of Bitcoin in circulation is the number that has been mined and is now owned by crypto holders.
Note that market capitalisation is calculated by multiplying the number of coins in circulation by the price of one coin.
No of coins x Price of 1 coin = Market Cap
So one USDT is $1, and there are about 83.5 Billion in circulation. Hence the market cap figure.
Compared to other cryptocurrencies, the number of USDT tokens in circulation always aligns with the overall market cap. Other coins like Bitcoin, for example, have different figures for these two variables.
Bitcoin has a market cap of $571.49 Billion, but only 19.45 Million are in circulation. Following our formula, if we divide 571.49 Billion by 19.45 million, we’ll get $29,380 or an approximate value of $30,000, and that’s the current price of 1 Bitcoin.
FAQs About The Amount of USDT in Circulation
Is USDT dollar?
No. USDT is a digital currency that is tied to the US dollar. It’s called a stablecoin because its value is derived from the value of 1 dollar. Some may refer to it as the digital USD, but that is only partially accurate because the US government issues USD, but they don’t own or issue USDT.
How much is USDT worth?
1 USDT is $1. Sometimes, the price shifts by $0.01 or $0.02, but at all times, it’s approximately $1. Remember that USDT is tied to the US dollar at a 1:1 ratio
Conclusion
USDT is the biggest stablecoin on the crypto market. It’s a token tied to the US dollar’s value. There’s no cap on the number of tokens that can exist because it is linked to USD. USDT works because the issuance company, Tether, keeps a reserve of fiat currency or fiat-backed assets whose value matches the number of tokens in circulation. That’s how it remains pegged to the value of the USD.
The number of USDT in circulation is 83.5 billion, and it’s the same value as the market cap.
USDT is a secure way to store value and transact with digital currencies while mitigating the effect of market volatility that is so common with regular cryptocurrencies. It’s undoubtedly a favourite among crypto holders, whether beginner or veteran. If you want to begin your crypto journey and minimise risks, you should find out how to buy USDT.
