Table of Contents
- In May, the United States exceeded expectations by adding 339,000 jobs, surpassing the estimated 195,000. Meanwhile, the price of Bitcoin remained stable at $27,000
- Despite the decline in the stablecoin market, the market capitalization of Tether reaches a record-breaking value of $83.2 billion
- According to blockchain security firm De.Fi, rugpulls, and scams caused crypto investors to suffer losses amounting to $54 million in May
In May, the United States exceeded expectations by adding 339,000 jobs, surpassing the estimated 195,000. Meanwhile, the price of Bitcoin remained stable at $27,000
According to a report released by the Bureau of Labor Statistics (BLS) on Friday morning, the U.S. economy experienced an addition of 339,000 jobs in May.
This figure surpasses the upwardly revised 294,000 jobs added in April and significantly exceeds the economists’ forecast of 195,000.
Initially, April’s job gain was reported as 253,000.
However, despite the positive job growth, the unemployment rate increased to 3.7% compared to April’s 3.4%, deviating from the projected rate of 3.5%.
Following the BLS release, the price of Bitcoin (BTC) remained slightly above $27,000.
The U.S. Federal Reserve has been implementing a series of rate hikes since early 2022 in an effort to combat persistently high inflation.
Despite the higher interest rates, the robust employment market has remained largely unaffected, providing the central bank with a reason to continue its monetary policy tightening.
The Federal Open Market Committee (FOMC) of the Fed is scheduled to convene on June 13-14, and there is divided market speculation regarding whether the central bank will raise rates once again.
This contrasts with the sentiment just a month ago when investors were almost certain of a pause in the rate hike cycle.
This change in market perception over the past few weeks has negatively impacted Bitcoin, causing its value to decline from nearly $30,000 to the $27,000 range observed prior to the release of this morning’s data.
Further examination of the report reveals that average hourly earnings rose by 0.3% in May, slightly lower than the 0.4% increase in April and the anticipated 0.4% growth.
On a year-over-year basis, average hourly earnings were in line with expectations, showing a 4.3% increase, down slightly from April’s 4.4%.
Despite the decline in the stablecoin market, the market capitalization of Tether reaches a record-breaking value of $83.2 billion
Tether’s USDT, a stablecoin issuer, has reached its previous record-high market capitalization, defying the shrinking stablecoin market.
The company reported that USDT’s market capitalization reached $83.2 billion on Thursday, matching its peak from just over a year ago.
This achievement comes after recovering the $18 billion lost following the collapse of the blockchain project Terra in May 2022 and subsequent market turmoil.
Tether’s milestone is particularly significant considering the overall decline of the stablecoin market over the past 14 months.
Stablecoins, which are a subset of cryptocurrencies worth $129 billion, play a crucial role in blockchain-based finance by bridging fiat currencies with digital assets and facilitating trading.
USDT has benefited greatly from the recent struggles faced by its closest competitors.
The second-largest stablecoin, USDC issued by Circle, was impacted by the collapse of its banking partner, Silicon Valley Bank, in March, leading to price stability issues.
Binance USD (BUSD), which once held a market cap of $20 billion, faced regulatory restrictions when New York state regulators prevented issuer Paxos from creating new tokens in February.
Tether has faced criticism for its lack of transparency regarding its reserve assets, including potentially risky loans to undisclosed debtors.
In a lawsuit alleging Tether’s involvement in manipulating the price of Bitcoin with newly minted tokens, a U.S. judge ordered the company to provide documents regarding USDT’s backing.
The Wall Street Journal also reported instances of Tether using falsified documents to secure bank accounts.
Despite these concerns, stablecoin holders have flocked to USDT during this turbulent period due to the perceived safety it offers from U.S. regulators and banks.
This has propelled USDT’s market share to its highest level in nearly two years.
According to Conor Ryder, an analyst at digital asset research firm Kaiko, Tether’s rise suggests that stablecoin holders prioritize peg stability over issuer transparency.
A recent Kaiko report raised suspicions about the “inordinate” surge in USDT’s market capitalization, as it did not align with the significant drop in trading volumes to multi-year lows.
Typically, other stablecoins’ market capitalization correlates with trading volumes.
Paolo Ardoino, Tether’s chief technology officer, attributed this difference to the growing use of USDT for payments, particularly in developing countries, which now account for approximately 40% of all token activity.
According to blockchain security firm De.Fi, rugpulls, and scams caused crypto investors to suffer losses amounting to $54 million in May
According to a recent report by De.Fi, the cryptocurrency market experienced a turbulent month in May 2023, marked by a series of scams and hacking incidents.
These events resulted in cumulative losses exceeding $54 million.
Interestingly, this amount represents a significant decrease compared to the $101.5 million lost in April, indicating potential improvements in security practices among users and developers.
However, despite the decrease in losses, none of the funds lost in May were recovered, unlike the $2.2 million that was successfully recovered in April.
The majority of incidents occurred within the BNB Chain ecosystem, accounting for losses of over $37 million across ten cases.
Ethereum-based projects experienced the fewest exploits, with losses slightly exceeding $2 million.
Among the top ten cases, Fintoch suffered the most significant loss of $31.7 million due to a smart contract exploit.
Jimbo Protocol on Arbitrum lost $7.5 million due to a rugpull, while Deus Finance on BNB experienced a loss of $6.2 million through a smart contract exploit.
Other noteworthy cases included Tornado Cash, Mother, WSB Coin, Linda Yaccarino, Block Forest, SNOOKER, and land, which suffered losses ranging from $145,000 to $733,000.
Rug pulls accounted for the largest number of incidents, with twelve cases resulting in losses totaling $37 million.
There were nine cases of exploits, causing losses of $8.8 million, and flash loan attacks, though less frequent with five cases, still led to substantial losses totaling $8.9 million.
Exit scams were responsible for two cases, resulting in a loss of $177,000.
The most commonly targeted category of assets was governance tokens, with 19 cases reported and losses totaling $3.3 million.
Decentralized exchanges (DEX) were targeted in three cases, resulting in losses of $4 million. Stablecoins experienced the highest single loss, reaching $6.2 million.
On the other hand, categories such as yield aggregators, gaming and metaverse applications, non-fungible tokens (NFTs), and centralized crypto platforms reported no losses during this period.
Borrowing and lending protocols remained unaffected as well.