Tether’s dollar-backed stablecoin USDt continued to grow at full speed in the fourth quarter of 2025, even as the broader crypto market struggled following October’s major liquidation event. Fresh data shows USDt strengthening its dominance while competing stablecoins either stalled or sharply declined.
USDt market cap reaches a new all-time high
According to the latest quarterly report from Tether, USDt’s market capitalization increased by $12.4 billion in Q4, pushing the total supply to a record $187.3 billion. This growth came during a period marked by reduced risk appetite across digital asset markets, highlighting USDt’s role as the primary liquidity backbone of crypto trading and payments.
While USDt expanded, rival stablecoins struggled to keep pace. Circle’s USDC, the second-largest stablecoin, saw its market cap fluctuate after the Oct. 10 liquidation cascade but ultimately ended Q4 largely unchanged. Meanwhile, Ethena’s synthetic dollar USDe experienced a steep contraction, dropping by 57% over the same period.
Onchain activity hits record levels
USDt’s growth was not limited to supply alone. Onchain metrics also reached historic highs during Q4. The average number of monthly active USDt wallets climbed to 24.8 million, accounting for nearly 70% of all stablecoin-holding wallets across blockchains.
Quarterly transfer volume surged to $4.4 trillion, while the total number of onchain transfers reached 2.2 billion. These figures underline USDt’s dominant position in everyday crypto transactions, from exchange settlements to cross-border payments.
Reserves, Treasuries, and user behavior
Tether reported total reserves of $192.9 billion at the end of Q4, up $11.7 billion from the previous quarter. This left the company with net equity of $6.3 billion. Exposure to US Treasuries rose to $141.6 billion, placing Tether among the largest Treasury holders globally, ahead of several sovereign nations.
User behavior remained relatively stable throughout the quarter. Around two-thirds of USDt supply is held in savings wallets and centralized exchanges, while the remaining third supports payments, remittances, and decentralized finance activity.
Illicit activity and compliance efforts
USDt continues to be the most commonly used stablecoin in illicit blockchain transactions, largely due to its scale and widespread adoption. Data from Bitrace shows that $649 billion in stablecoins, or roughly 5.14% of total stablecoin transaction volume, flowed through high-risk addresses in 2024. Tron-based USDt accounted for more than 70% of that activity.
In response, Tether has intensified its compliance efforts, launching joint initiatives with TRM Labs and Tron to monitor suspicious activity and freeze illicit funds when necessary.
Tether expands in the US and emerging markets
In January, Tether introduced USAt, a dollar-pegged stablecoin designed specifically for the US market. Issued by Anchorage Digital Bank, USAt is compliant with the US GENIUS Act and launched with an initial supply of $10 million on Ethereum.
Tether also moved to expand real-world usage. This week, the company partnered with Opera to integrate USDt and Tether Gold into Opera’s MiniPay wallet, aiming to improve access to digital payments across emerging markets.
Despite market volatility, USDt’s Q4 performance reinforces its status as the dominant stablecoin, combining record supply growth, rising onchain activity, and expanding global use cases.
