Tether Adds $5.25B in Market Cap Liquidity: Is It a Good Thing?

Tether’s market cap has surged $5.25 Billion in March, signaling an increased demand for stablecoins in the cryptocurrency market.

Little boy celebrating stablecoins.
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  • The surge in Tether’s market cap has pointed to a growing demand for stablecoins in the crypto space.
  • Stablecoins have provided stability in the volatile crypto market and have acted as a safe haven for investors.
  • The growth of Tether liquidity has outpaced Bitcoin ETFs, highlighting a deeper pool of stablecoin capital.

The cryptocurrency market is witnessing a surge in liquidity, fueled by a significant increase in the market capitalization of Tether (USDT), the leading stablecoin in the ecosystem. Since the beginning of March, Tether’s market cap has climbed by over $5.25 billion, indicating a growing demand for stablecoins within the crypto space.

Tether Market Cap’s Upward Trend

This rise in stablecoin funding is a positive sign for overall market health. Stablecoins pegged to traditional assets like the US dollar provide stability within the often volatile cryptocurrency market. They act as a safe haven for investors seeking to enter or exit positions in other cryptocurrencies without converting back to fiat currency. 

This readily available pool of stablecoins helps meet the buying and selling demands of Bitcoin (BTC) and other altcoins. For context, the combined growth of spot Bitcoin Exchange Traded Funds (ETFs) this month falls short of the increase in USDT liquidity. 


Despite significant growth, these Bitcoin ETFs have only attracted less than $4 billion in net inflows. This highlights the deeper pool of stablecoin capital currently available, potentially fueling further accumulation of both Bitcoin and altcoins on cryptocurrency exchanges.

Tether’s current market capitalization is $104 Billion, according to data from CoinMarketCap. This represents a steady rise from around $98.65 billion at the start of March, with a brief consolidation period masking the overall upward trend. 

Is Tether the Backbone of Crypto Trading?

However, concerns continue to linger regarding Tether’s reserve backing. Despite these controversies, Tether has undeniably played a crucial role in establishing stability and facilitating large-volume trades within the crypto market. USDT’s dominance is evident, as it forms a trading pair with most altcoins across various cryptocurrency platforms.


Looking beyond its role as a stablecoin issuer, Tether Holdings, the company behind USDT, is actively diversifying its operations. They are venturing into Bitcoin mining and development, with significant investments in the sector. 

On the Flipside

  • Tether has a history of facing criticism regarding the transparency of its reserves.
  • While stablecoins offer stability, a sudden surge in USDT issuance could theoretically impact overall market volatility.
  • If Tether faces issues or loses its peg to the dollar, it could have a cascading effect on the entire crypto market.

Why This Matters

This surge in Tether’s market cap, surpassing the combined growth of Bitcoin ETFs, suggests investors are increasingly comfortable using stablecoins for crypto purchases. This ample liquidity pool could fuel further growth in Bitcoin and altcoin prices, potentially leading to a significant bull run in the broader cryptocurrency market.

To learn more about how Tether’s USDT on Celo drives mainstream crypto adoption, read here:

How Tether’s USDT on Celo Drives Mainstream Crypto Adoption

To learn more about Tether (USDT) reaching a market cap of $100 billion, read here:

USDT Hits $100B Market Cap as Stablecoins Match Market Rally

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Kyle Calvert

Kyle Calvert is a cryptocurrency news reporter for DailyCoin, specializing in Ripple, stablecoins, as well as price and market analysis news. Before his current role, Kyle worked as a student researcher in the cryptocurrency industry, gaining an understanding of how digital currencies work, their potential uses, and their impact on the economy and society. He completed his Masters and Honors degrees in Blockchain Technology within Esports and Business and Event management within Esports at Staffordshire University.