Bitcoin blew past $12,000 to its highest price in two months, bringing into view the prospect of a fresh 2020 high.
The largest cryptocurrency was changing hands Wednesday around $12,200, within striking distance of the year’s high around $12,500. And that was even before the news emerged that electronic consumer payments giant PayPal had been granted a conditional New York state license for a partnership to buy and sell cryptocurrencies.
“Coupled with a seemingly constant flow of reports of traditional funds and companies investing or allocating some of their balance sheet to Bitcoin, we were due for a move up,” Matt Blom, head of sales and trading for the publicly traded digital-asset firm Diginex, told subscribers in his daily newsletter.
In traditional markets, European equity indexes were lower, U.S. stock futures fluctuated and 10-year Treasury yields rose on renewed speculation that lawmakers in Washington might still be moving toward a stimulus package. Gold rose 0.6% to $1,919 an ounce.
Market moves
While tether (USDT), with a market cap surpassing $16 billion, continues to hold the lion’s share of stablecoins in circulation, two smaller rivals are trouncing it in crypto’s hottest market this year, decentralized finance (DeFi).
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Measured by the total value locked in six of the most popular DeFi protocols – Compound, Maker, Uniswap, Curve, Aave and Balancer – USD coin (USDC) is in the lead among stablecoins followed by dai (DAI), the native stablecoin to MakerDAO. That’s according to data compiled by Flipside Crypto as of Oct. 19.
USDC and DAI have market caps of $2.74 billion and $608 million, respectively. Yet, unlike on centralized exchanges, where tether is the go-to stablecoin in dollar-based crypto trades, USDC and DAI seem to have found their niche as the preferred stablecoins in decentralized trades.
In an interview with CoinDesk, Jeremy Allaire, peer-to-peer payments company Circle’s co-founder, attributed USDC’s success in DeFi to his company’s early efforts in building relationships with the DeFi communities. The fact the two companies that co-founded USDC’s governing Centre consortium, Circle and crypto exchange Coinbase, are both registered financial entities in the United States may also have something to do with USDC’s recent upturn. According to Allaire, USDC is preferred by institutional investors for being “safe, trusted and regulated.”