Amid sky-high economic uncertainty from the effects of the coronavirus, stablecoins have experienced stunning inflows of value—but not all platforms have benefitted equally.
Between March 18 and April 1, the supply of stablecoins grew more than 60%. BUSD and HUSD, the Paxos-powered stablecoins built for Binance and Huobi, added a stunning 278% and 56%, respectively, to their total supply in that short time. On the other end of the spectrum, DAI supply increased just 10% as investors shunned the DeFi-powered stablecoin after significant flaws in the platform were revealed during the ‘Black Tuesday’ crypto crash.
According to a spokesperson for Paxos, the digital asset infrastructure company behind BUSD and HUSD, the source of recent supply growth in those coins isn’t all established crypto investors. Paxos told Decrypt, “We are also seeing customers who are purchasing digital assets for the first time” as they recognize they can hold dollar-pegged assets that are accessible outside of traditional banking hours. “When both traditional and crypto markets present unpredictable volatility, this is valuable.”
Paxos’ director of communications, Rebecca McClain, also noted growing interest in the Paxos gold-backed PAXG token. “Customers are interested in gold now more than ever,” she told Decrypt. “We’ve seen PAX Gold grow more than 50% to $25M over the past week. We are getting a lot of new customers who are moving into digital assets for the first time, driven by the desire to own more physical gold quickly.”
Paxos Gold is regulated by the New York State Department of Financial Services, unlike competing product Tether Gold, giving it extra weight with traditional investors looking for some stability in crypto markets.
So what does all this competition mean for Tether,