Brazil’s Receita Federal – the special ministry of federal revenue – recently reported a substantial increase in the use of stablecoins, especially USDT from Tether.
According to the supervisor reportUSDT’s volume surpassed the combined trading volume of all other cryptocurrencies in 2022.
Stablecoins represent roughly 10% of the crypto industry’s global trading volume and are generally more trusted as a safe haven when crypto market volatility peaks.
Since their inception, stablecoins have grown over the years to become an important asset for anyone involved in digital assets, as they bridge the gap between fiat currencies and cryptocurrencies.
Stablecoins also offer a level of predictability that makes them increasingly popular for various financial transactions.
USDT vs crypto
In Brazil, data from Receita Federal indicates that the most traded stablecoins are USDT (Tether) and USDC, both of which are pegged to the US dollar, along with BRZ, which is pegged to the Brazilian real.
Since 2019, the Receita Federal has been conducting monthly assessments to track the growth of stablecoin usage.
Based on the regulator’s research, stablecoins have surpassed Bitcoin in transaction volume.
Based on partial data for 2023, 80% of reported cryptocurrency transactions are related to USDT, making it the most traded digital asset in the country over the past 10 months.
Bitcoin is lagging behind
According to the regulator, USDT started overtaking Bitcoin’s trading volume in 2022 after the high-profile collapse of Terra LUNA caused investors to flee to assets immune to the extreme volatility, such as stablecoins. USDT has become
USDT trading volumes in Brazil exceeded 271 billion Brazilian reais (approximately $54 billion) during the observed period – almost twice the volume of the flagship crypto Bitcoin (BTC), which traded for just over 151 billion reais (approximately $30 billion) during the same period ) was traded. time frame.
By comparison, global 24-hour trading volumes for USDT and Bitcoin were $14.58 billion and $14.01 billion, respectively.
Although USDT has higher volume on average, its lead has never been greater than about 50% and has never surpassed the combined trading volume of all digital assets.
Regulatory issues
The Receita Federal said it has been closely monitoring the significant growth in USDT usage as it could have significant implications for the country’s tax and regulatory landscape for digital assets.
An analysis of public data reveals a notable shift in the profile of cryptocurrency transactions in recent years. The dominance of Bitcoin and other cryptocurrencies has been overshadowed by the growing popularity of stablecoins like Tether.
According to the regulator, this shift deserves government attention and could potentially lead to additional legislation for the digital assets industry.