Tether loses $6.6B in market cap as banks bet $270M on Project Faro

Liquidity in the stablecoin space has contracted rapidly, reducing one of the most significant sources of buying power from crypto markets. Over the last 60 days ending on the 7th of November, according to CryptoQuant, Tether [USDT] saw its market capitalization drop by $6.6 billion. This represents the largest such contraction since CryptoQuant began tracking this metric in 2022, exceeding a $3.2 billion decline in the wake of the FTX collapse. Trends suggest that investors are withdrawing capital from stablecoins instead of holding them ready for use in crypto trades. Overall, stablecoin capitalization now stands at approximately $290 billion. With less capital available to provide dollar backing for potential sales and new position entries, there appears to be fewer dollars remaining to fund a crypto market recovery.

BeCrypto News shows a short excerpt and links to the publisher. The full report belongs to AMBCrypto.