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Tether’s USDT grows as stablecoin supply tops $300B, rivals decline
Bank-backed and GENIUS Act-compliant stablecoins are struggling to dent Tether's dominance, even as the total market adds nearly $100B in 2025.
The stablecoin market has blown past $300 billion in total supply. And Tether, the company that crypto’s regulatory class has spent years trying to dethrone, is eating a bigger slice of the pie than ever.
USDT now accounts for roughly 58-63% of the entire stablecoin market, depending on which tracker you prefer. Arkham pegs the supply around $176 billion, while DefiLlama shows it closer to $189-190 billion.
The $100 billion surge
To appreciate what’s happened here, rewind to early 2025. The total stablecoin supply sat around $205 billion. In the months since, nearly $100 billion in new supply has flooded into the market.
The World Economic Forum has estimated stablecoins’ aggregate market cap at around $300 billion, noting their role in facilitating transactions worth trillions of dollars.
The expansion of the stablecoin sector coincides with a risk-on phase in digital assets, increased usage of Layer 2 solutions on Ethereum and other chains, and stablecoins being utilized for on-chain settlements.
USDT dominates trading pairs on centralized exchanges, serves as the go-to instrument for cross-border remittances in emerging markets, and remains the most widely used collateral token in DeFi lending protocols.
The compliance crowd’s cold start
Bank-issued stablecoins and those designed to comply with the proposed GENIUS Act ā the bipartisan legislation aimed at creating a federal regulatory framework for stablecoins ā have had a harder start than many expected.
Circle’s USDC, the largest regulated alternative, has maintained its position as the number two stablecoin but hasn’t meaningfully closed the gap with Tether. The newer bank-backed entrants are even further behind, struggling to establish the kind of exchange integrations and DeFi presence that drive organic demand.
Why this matters for investors
The sector’s growth from $205 billion to over $300 billion in 2025 alone signals that demand for dollar-denominated digital assets is accelerating. Tether’s continued dominance within that growth carries a specific message: the market is prioritizing liquidity and ubiquity over regulatory pedigree.
Tether’s reserve composition and audit practices remain less transparent than those of its regulated competitors.
Investors watching this space should pay attention to two metrics going forward: USDT’s share of total stablecoin supply, and the pace at which bank-backed stablecoins gain exchange and DeFi integrations.