Brazil’s Receita Federal — the Particular Division of Federal Income — has lately reported a considerable improve within the utilization of stablecoins, particularly Tether’s USDT.

In response to the regulator’s report, the quantity of USDT exceeded the mixed buying and selling quantity of all different cryptocurrencies in 2022.

Stablecoins make up roughly 10% of the worldwide buying and selling quantity of the crypto business and are usually trusted extra as a protected haven when volatility peaks within the crypto market.

Over time since their inception, stablecoins have change into a staple holding for anybody concerned in digital property as they bridge the hole between fiat currencies and crypto.

Stablecoins additionally provide a degree of predictability that has made them more and more widespread for varied monetary transactions.

USDT vs Crypto

In Brazil, Receita Federal information signifies that essentially the most incessantly traded stablecoins are USDT (Tether) and USDC, each of that are pegged to the U.S. greenback, together with BRZ, which is linked to the Brazilian actual.

Since 2019, the Receita Federal has been conducting month-to-month assessments to maintain observe of the expansion in stablecoin utilization.

Primarily based on the regulator’s analysis, stablecoins have surpassed Bitcoin in transaction quantity.

Primarily based on partial information for 2023, 80% of reported cryptocurrency transactions are associated to USDT, making it essentially the most traded digital asset within the nation during the last 10 months.

Bitcoin lagging

In response to the regulator, USDT started overtaking Bitcoin buying and selling quantity in 2022 after the high-profile collapse of Terra LUNA brought about traders to flee into property that had been proof against the acute volatility, akin to stablecoins. USDT has change into

USDT’s buying and selling volumes in Brazil exceeded 271 billion Brazilian reais (roughly $54 billion) in the course of the noticed interval — almost twice the quantity of the flagship crypto Bitcoin (BTC), which traded at a little bit over 151 billion reais (roughly $30 billion) throughout the identical timeframe.

Comparatively, the worldwide 24-hour buying and selling volumes for USDT and Bitcoin stood at $14.58 billion and $14.01 billion, respectively.

Whereas USDT has a better quantity on common, the lead has by no means been bigger than roughly 50%, and it has by no means surpassed the mixed buying and selling quantity of all digital property.

Regulatory considerations

The Receita Federal stated it has been intently monitoring the numerous development of USDT utilization because it may have substantial implications for the nation’s tax and regulatory panorama for digital property.

An evaluation of public information reveals a notable shift within the profile of cryptocurrency transactions in recent times. The dominance of Bitcoin and different cryptocurrencies has been eclipsed by the rising recognition of stablecoins like Tether.

In response to the regulator, this shift warrants the federal government’s consideration and will doubtlessly result in extra laws for the digital asset business.