The largest stablecoin by market cap, tether (USDT), is also the most popular stablecoin in East Asia, making up 93% of all stablecoin value transferred by addresses in the region, a blockchain analysis company Chainalysis has learned.
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According to a reported titled "East Asia: Pro Traders and Stablecoins Drive World’s Biggest Cryptocurrency Market," over 30% of all value transacted on-chain related to stablecoins is based in East Asia.
As a result of such spike in popularity, USDT even surpassed bitcoin to be the most-received digital asset in June 2020.
Chainalysis says much of stablecoins’ popularity in East Asia is caused due to the Chinese government’s decision in 2017 to prohibit direct exchanges of yuan for cryptocurrency.
"As a result, tether has become the de facto fiat stand-in for Chinese cryptocurrency users and primary means of on-ramping to bitcoin and other standard cryptocurrencies," the company wrote in a
While yuan-for-USDT trades are also under the ban, the Chinese crypto community commonly buy the stablecoin under the table on the OTC market.
In June, thousands of cryptocurrency over-the-counter traders in China reported their bank accounts had been banned as a result of a police raid over an alleged crypto-related Ponzi scheme through the OTC market.
While it is still unknown under which circumstances more than a thousand bank accounts in China had been frozen, representatives of large Chinese banks said they do not freeze accounts as long as financial operations do not involve illegal activity such as money laundering and fraud.
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