dailyhodl.com
Market intelligence platform Kaiko Analytics reports that new competitors are chipping away at Tether’s ($USDT) stablecoin dominance.
In a new report titled “Tether Loses Market Share,” Kaiko Analytics says that the stablecoin issuer’s market share over centralized exchange platforms (CEXs) has dipped 13% year-to-date (YTD) due to the growth of rival dollar-pegged digital assets, such as $FDUSD and $USDC.
“Despite its dominant market position, $USDT’s market share on CEXs has been trending downwards, declining from 82% to 69% YTD. This decrease can be partly attributed to growing competition from stablecoins like $FDUSD which benefit from Binance’s zero-fee promotions.
$USDC has also experienced a rise in its market share, signaling a growing preference for regulated alternatives. At present, stablecoins issued in the US make up 10% of the overall stablecoin trade volume.
Only one of the top five stablecoins by market cap, Circle’s $USDC, is regulated under state US money transmitter frameworks. Nevertheless, its share has increased from less than 1% in 2020 to 11% today.” 
According to Kaiko, other rivals such as Ethena ($USDe), which uniquely offers yield, could also be cutting into Tether’s market dominance.
“Another reason for Tether’s declining market share could be linked to the emergence of innovative yield-bearing alternatives such as Ethena’s $USDe. Since its launch in February, $USDe’s volume has grown significantly, although it has retreated from April’s all-time high of more than $800 million following Ethena’s ENA airdrop.”
According to Tether’s 2024 Attestation Report, the firm posted a record-breaking $4.52 billion in profits during the first quarter of the year.