USDT’s market capitalization fell by $6.6 billion over 60 days, more than twice the decline recorded in December 2022 following FTX’s collapse. The contraction is part of a broader reduction of more than $7 billion in the total stablecoin market since early November, which fell from $296 billion to $288.8 billion according to DefiLlama. Investor withdrawals and Bitcoin’s decline, from approximately $86,500 at the end of September to $73,500, indicate reduced liquidity in the crypto market. However, analyst Darkfost cautioned that the contraction should be put into perspective: it represents about 4% of USDT’s current capitalization, compared with slightly less than 5% after FTX’s collapse.
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