Tether’s USDT has achieved a historic milestone with its market capitalization exceeding $150 billion, underscoring its rapid and sustained growth. In 2024 alone, its market cap surged by over $11 billion, reflecting increasing adoption and trust in the stablecoin ecosystem.
This achievement not only highlights Tether’s dominant position but also marks a significant moment for the broader cryptocurrency industry since its launch in 2014.
USDT’s Market Dominance and Growth Trajectory
Tether celebrated this milestone on social media, emphasizing the foundational role of USDT:
Tether introduced not only USD₮ but also pioneered the entire stablecoin sector. Today, USDT is trusted by over 400 million users and powers the digital economy.
With this new milestone, USDT’s dominance in the stablecoin market has slightly increased to 62%. According to Defillama, this growth is partly due to a 3.79% expansion in the past month, while its closest competitor, Circle’s USDC, grew by only 1.23%.
Other stablecoins are also gaining traction. BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL), a tokenized U.S. Treasury product, saw its market cap surge by 19.30% over the past month, reaching $2.89 billion. Similarly, MakerDAO’s DAI and PayPal’s PYUSD increased by 12.07% and 5.16%, respectively.
Network Growth and Stablecoin Expansion
Recent growth in USDT’s supply has been largely driven by minting activity on the Tron network. Data from Artemis Analytics shows that over the past three months, Tron’s stablecoin supply increased by $12.2 billion, significantly outpacing growth on BNB Smart Chain ($2.3 billion) and Ethereum ($1.7 billion).
The overall stablecoin sector has also reached a new all-time high, with a total market cap of $242.81 billion—a 3.75% increase over the past 30 days. While USDT and USDC remain the largest players, smaller stablecoins are growing at a faster rate.
Stablecoin Transaction Volume and Global Impact
The rising supply of USDT mirrors the growing influence of stablecoins in transactions. According to Bitwise, stablecoin transaction volume in 2024 is set to surpass that of Visa for the first time.
Artemis data indicates that on-chain stablecoin transaction volume reached $3.4 trillion over the past 30 days, a 31.45% year-over-year increase. Even after adjusting for reduced MEV and exchange-based trading, the volume stood at $2.3 trillion, with a daily average of approximately $75 billion.
Stablecoin usage is also broadening. Over the past month, 717.6 million on-chain transactions were recorded, representing a 20.70% increase in usage, with 28.7 million unique addresses participating.
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Traditional Finance Embraces Stablecoins
As stablecoins begin to capture market share from traditional payment processors, major financial players are integrating them into their offerings.
Fintech firm Stripe recently launched stablecoin accounts for businesses in 101 countries and plans to introduce corporate stablecoin cards in partnership with Ramp. This follows Stripe’s acquisition of stablecoin infrastructure company Bridge.
PayPal’s PYUSD, launched last year, has also seen significant growth after early challenges, nearing a $1 billion market cap. Recent growth is likely fueled by the company’s decision to offer a 3.7% annual yield on its stablecoin.
Even Visa has made strategic moves, investing an undisclosed amount in BVNK, a startup focused on stablecoin payment infrastructure. This investment signals that Visa now views stablecoins as part of the global payment ecosystem.
Frequently Asked Questions
What is Tether’s USDT?
USDT is a stablecoin issued by Tether, designed to maintain a 1:1 peg with the U.S. dollar. It is widely used for trading, remittances, and as a digital dollar alternative.
How does USDT maintain its value?
Tether claims to back each USDT token with reserves consisting of cash, cash equivalents, and other assets. Regular audits and transparency reports aim to ensure full backing.
Why are stablecoins like USDT growing so rapidly?
Stablecoins offer fast, low-cost transactions compared to traditional banking. They are also increasingly used in decentralized finance (DeFi), trading, and cross-border payments.
What are the risks of using stablecoins?
Key risks include regulatory uncertainty, potential reserve insolvency, and smart contract vulnerabilities. Users should research issuers and use cases carefully.
How do stablecoins compare to traditional payment networks?
Stablecoins often provide faster settlement and lower fees than networks like Visa or Swift, especially for international transfers.
Can stablecoins generate yield?
Yes, some stablecoins, like PayPal’s PYUSD, offer yield-bearing features. Others can be used in DeFi protocols to earn interest through lending or liquidity provision.