Stablecoins Market Tightens as Tether and Circle Control 84% of Supply

TLDR:

• Tether and Circle together control 84.56% of the stablecoin market, leaving 15% for all other projects.
• USDC settled over $1.2 trillion in transaction volume last month, more than doubling January’s figures.
• DAI, once the face of decentralized stablecoins, now holds less market share than PayPal’s PYUSD product.
• Both Tether and Circle can freeze user funds via one API call, raising concerns about crypto centralization.
  

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Stablecoins remain a focal point in digital finance as new data reveals a deeply concentrated market. Two companies — Tether and Circle — now control 84.56% of the entire stablecoin supply.

USDT holds 59.74% of market share, and USDC accounts for 24.82%. In parallel, USDC settled over $1.2 trillion in transaction volume last month.

That figure surpassed Tether for the second consecutive month. The remaining share is spread across dozens of smaller competing projects.

Two Centralized Issuers Hold the Stablecoin Market in a Tight Grip

The stablecoin market has grown increasingly narrow, with two issuers pulling far ahead of all others. Tether’s USDT alone holds nearly 60% of circulating stablecoin supply.

Circle’s USDC adds another 24.82%, per data shared by @ourcryptotalk. Together, they leave approximately 15% for all remaining projects combined.

Within that leftover share, competition is spread thin across many projects. USDS holds 2.26%, followed by USDe at 1.95% and USD1 at 1.51%.

DAI and PayPal’s PYUSD hold 1.46% and 1.37%, respectively. Dozens of other projects share the remaining 6.89%, grouped under a broader “Others” category.

DAI’s current standing is a notable turn for the decentralized finance space. It once served as the flagship example of a non-custodial, community-governed stablecoin.

Today, it holds a smaller share than PayPal’s PYUSD. That outcome shows how much the competitive landscape has shifted in recent years.

Ethena’s USDe uses a synthetic dollar model built on funding rate arbitrage strategies. It has grown to nearly 2% of the stablecoin market in a short time.

The model performs well under stable market conditions. It does, however, carry risks that could emerge during periods of heightened volatility.

USDC Transaction Volume Surge Places Circle at the Forefront of Dollar Settlement

Circle’s USDC has been settling transactions at a high pace this year. Last month’s volume crossed $1.2 trillion, more than double January’s total.

That growth points to rising reliance on USDC as a settlement layer. The trend stretches well beyond retail use into institutional finance.

Analyst @Mega_Fund noted that USDC outpaced Tether in transaction volume for two straight months. This marks a measurable shift in how large-scale players are choosing to settle transactions.

Regulated, compliant infrastructure appears to be a top priority for institutions. Circle is increasingly being seen as the preferred option in that category.

The rising volume also points to stablecoins taking on a more structural role in global finance. Demand is concentrating around platforms with clear regulatory frameworks and institutional-grade rails.

Circle’s focus on compliance has placed it in a strong competitive position. The contest for dominance over the global dollar settlement layer is actively underway.

The concentration of control in two centralized issuers continues to draw scrutiny. Both Tether and Circle can freeze user funds through a single API call.

This stands against the decentralized principles that originally shaped crypto. The tension between utility and centralization remains central to the ongoing stablecoin debate.

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