This week, crypto-to-crypto derivatives exchange FTX has seen a huge amount of trading volume from its own stablecoin USDC, according to data from CoinGecko. The data shows that FTX accounted for almost 90% of all U.S. dollar coin (USDC) transfers in the network. Of these transfers, most were redemptions of the stablecoin for fiat U.S. dollars and for Tether (USDT) — both pegged 1:1 to the dollar — with a small fraction used to purchase bitcoin (BTC).
According to the research firm’s calculations, FTX saw nearly 500x more trades on its platform than it did in October of last year. The trading volume was concentrated in two pairs: ETH/USDC and BTC/USDC.
USDC Going Rosy
The reason behind this surge may be due to the recent collapse of fiat-backed stablecoin FUSDEX which led many users to seek out alternative fiat-backed options such as TUSD or USDC.
USDC is a digital asset developed by Circle, which can be redeemed for fiat US dollars at any time and used to purchase other cryptocurrencies or pay for goods and services online. In contrast to Tether (USDT) which is pegged to the value of fiat currency held in reserve on bank accounts around the world, USDC is backed by an equivalent amount of actual U.S. dollars held by Circle’s custodian partner Prime Trust LLC., licensed as a trust company under South Dakota law as well as an S Corp under Delaware law.
The FTX data is the latest example of how stablecoins can be used in crypto trading. The exchange has seen a huge amount of volume from its own stablecoin USDC, according to CoinGecko. This week, FTX accounted for almost 90% of all U.S. dollar coin (USDC) transfers in the network; most were redemptions for fiat U.S. dollars and Tether (USDT).
