Reports said that the percentage of USD Circle (USDC) stablecoins held by major wallet addresses dropped to its lowest point in almost two years as the cryptocurrency market downturn continues.
It has been reported that cryptocurrency analytics firm Glassnode has released the latest data on USDC metrics, reflecting a recent sell-off of the second biggest US dollar-backed stablecoin by market capitalization. As previously reported, sanctions imposed on cryptocurrency mixer Tornado Cash by the US Treasury Department had a marked effect on the capitalization of both USDC and its biggest competitor, Tether (USDT).
However, while USDT markets saw growth of almost $2 billion in the days following the sanctions, USDC’s market cap shrunk after its issuer Circle decided to freeze some 75,000 USDC tokens held by addresses linked to Tornado Cash. Various commentators have suggested that some users shifted funds from USDC to USDT, given the correlation in the decline and growth of the respective stablecoins’ market cap.
Data from Glassnode shows that the percent of USDC held by the top 1% of addresses reached a 22-month low of 87.667%. While on-chain data shows that there has been a sell-off of USDC over the past fortnight, metrics released by Glassnode on August 22 showed that the seven-day moving average of USDC exchange deposits also reached its lowest point since March 2021.
The report said that while the market cap of USDC might be down, the stablecoin reached a three-year high in terms of weekly mean transaction volume, surpassing the previous high registered in June 2022. USDC had been touted to contend with USDT as the top stablecoin of 2022 by market capitalization in July 2022, edging to within $11 billion of Tether's market cap. This percentage has eroded since the Tornado Cash debacle.
Thus, Tether remains mute on whether it would blacklist or freeze USDT tokens linked to the sanctioned mixer.
Source: Cointelegraph