Bitcoin ETF Issuer VanEck Enters Stablecoin Market, Reveals Must-Know Facts

Nick Van Eck, the son of investment management veteran Jan Van Eck, is making a major bet on cryptocurrencies through the family business, a move that underscores growing interest in the stablecoin market.

Agora, a startup co-founded by spot Bitcoin exchange-traded fund (ETF) manager VanEck and crypto veterans Drake Evans and Joe McGrady, recently raised $12 million in a seed round to launch its USD Stablecoin.

VanEck-backed Agora enters the stablecoin field

According to a report from Bloomberg, Agora’s stablecoin will be backed by cash, U.S. Treasury bills, and overnight repurchase agreements. It will be managed by VanEck, said Kyle DaCruz, VanEck’s director of digital asset products.

DaCruz emphasized the importance of having an audited and transparent stablecoin reserve to ensure transparency and trustworthiness. Agora plans to build this future by partnering with crypto companies including exchanges, custodians, decentralized applications (dApps) and trading firms, rather than directly targeting customers in different regions.

While Tether currently dominates the stablecoin space, with a market capitalization of approximately $104 billion, and Circle-issued USDC holds approximately $32 billion, VanEck believes there is still room for newcomers.

According to the report, Agora plans to focus on regions like Argentina and Southeast Asia to fill market gaps. In these areas, stablecoins have already brought significant impact.

It’s worth noting that Agora’s stablecoins will only be available to users outside the United States due to the lack of federal legislation governing stablecoins in the United States. VanEck stressed the importance of regulatory clarity and intends to primarily serve international clients until such legislation is introduced.

Agora plans to establish revenue sharing contracts with its partners to provide them with benefits, while individual holders of Agora will not receive benefits or income directly. VanEck also expressed concerns about some projects in the stablecoin space, especially after the TerraUSD incident, and emphasized the need to build a company that actively promotes the development of the industry.

Bitcoin ETF trading volume surges to $111 billion

Spot Bitcoin ETFs traded $111 billion in March, nearly triple February’s total of $42.2 billion, amid a significant increase in interest in the newly approved investment vehicle.

Speaking on social media site X (formerly Twitter), Bloomberg ETF expert Eric Balchunas highlighted the significance of this milestone, highlighting the significant increase in trading volume with the following statement:

“Bitcoin ETFs traded $111 billion in March, which is almost three times what they did in February and January. I can’t imagine April will be bigger, but who knows.”

Bitcoin ETF market trading volume increased significantly in March compared to previous months | Source: Tweet by Eric Balchunas on X

Among existing spot ETFs, spot ETFs issued by Grayscale (GBTC), BlackRock (IBIT) and Fidelity (FBTC) continue to dominate trading volume, but Grayscale’s GBTC fund has experienced more than 150 transactions since it began trading in January. Total outflows of USD 1 billion.

The significant growth in spot Bitcoin ETF trading volume reflects increased demand for cryptocurrency investment products. ETFs are gaining ground as a popular option as more investors seek to enter digital asset markets through regulated and easily accessible vehicles.

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