XRP flips USDT again to become the 3rd-largest cryptocurrency by market cap
On December 1, XRP surpassed USDt, passing both Solana and Tether’s stablecoins. XRP has overtaken Tether’s USDt stablecoin to become the third-largest cryptocurrency by market capitalisation, after only Bitcoin BTC$98,090 and Ether ETH$3,599.21. On Jan. 3, the market cap of XRP XRP$2.45 soared to $138.98 billion, surpassing USDt USDT$0.9995, which witnessed a $1.6-billion fall in market value since Dec. 30, coinciding with the implementation of the European Union’s Markets in Crypto-Assets (MiCA) Regulation.
At the time of publication, XRP was trading for $2.43, up 17% in the previous 14 days, according to CoinGecko. Over the last year, XRP has increased by over 280%.
USDT’s market share is declining as the MiCA framework tightens requirements for stablecoin issuers. The regulations compel stablecoin issuers to keep full reserves and get licenses to operate in the European Union.
On December 13, Coinbase Europe delisted USDT for violation with MiCA. Coinbase and Circle together introduced USD Coin USDC$1.00 in 2018, and the exchange owns a stake in Circle. USDC fell below its $1 peg in March 2023, following the fall of Silicon Valley Bank. European officials have yet to establish whether USDT is completely compliant with MiCA requirements.
XRP gains momentum amid ETF speculation
This is not the first time that XRP has flipped USDT. On December 1, XRP surpassed both Solana (SOL$217.56) and USDT in market capitalisation rankings.
XRP’s latest run began following Donald Trump’s victory in the US presidential election on November 5, which bolstered broader market mood due to hopes of pro-crypto policies under the new administration.
Speculation of a spot XRP exchange-traded fund (ETF) has also fuelled XRP’s growth. WisdomTree is the fourth business to file for a spot XRP ETF with the US Securities and Exchange Commission, following Bitwise, Canary Capital, and 21Shares.
Bitwise and 21Shares were among the first to issue spot Bitcoin ETFs in January 2024.
XRP’s outsized price performance coincides with Ripple Labs’ launch of Ripple USD (RLUSD), a US dollar-backed stablecoin, on December 17. The stablecoin will be included into Ripple Payments in early 2025, allowing enterprise clients to conduct cross-border transactions. According to CoinGecko, RLUSD has already reached a market capitalisation of $72 million.
Tether remains the dominant stablecoin
Despite the decline, Tether continues to dominate the stablecoin market.
USDT accounted for 67.21% of the $204 billion stablecoin market in December, according to DefiLlama data. USDC, Coinbase’s second-largest stablecoin, trails behind with a market capitalisation of $44 billion.
Despite continuous fear, uncertainty, and doubt, or FUD, the USDT user base increased by 11.7% in December, adding 21.9 million new users compared to 19.6 million in November, according to a Dune Analytics dashboard. In comparison, USDC experienced a 24% growth in new addresses, with 5.7 million created in December, up from 4.57 million the previous month.
Tron continues to be the most popular platform for USDT activity, accounting for 53.8% of addresses. USDC, on the other hand, has the highest traction on Solana, where 30% of its users dwell, followed by Ethereum layer-2 Base at 6.5%.
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