$ 7.2 billion in stablecoins backed Bitcoin futures

Stablecoins play a very important role in the booming crypto industry. In fact, the industry’s phenomenal growth this year is largely due to stablecoins, which are fueling global demand for dollars due to both their accessibility and cost-effectiveness.

Stablecoins, which are used as collateral for Bitcoin futures

In January, stablecoin supply was over $ 27 billion. So far, that’s about $ 140 billion, a whopping 400% increase over 12 months.

In addition to facilitating easy access to US dollars, stablecoins use cases are becoming increasingly common in Bitcoin trading, providing dollar on / off ramps to exchanges while also allowing traders to borrow against their digital assets.

Follow Data from Glassnode, the Bitcoin futures market has since drastically reduced the margin used by traders. In April that number is around 70%. Now the drop rate is below 45% as traders no longer have to worry about a falling market as their assets are backed by stablecoins.

In addition, Bitcoin futures OI (Open Interest) worth over 7 billion US dollars are collateralized by stablecoins such as BUSD, USDT, etc.

Increased focus on stablecoins

With the growing growth of the stablecoin space, regulators around the world are becoming more interested in the activities of the issuers of this coin to improve investor protection. .

A recent Treasury Department report suggests that stablecoins should be managed like banks so that issuers can prove themselves reserve claims, which are essentially backed by a 1: 1 popularity.

According to Rep. Patrick McHenry (RN.C.), stablecoins could be the first crypto space where financial regulators are getting the best of both worlds.

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