USDT Market Share Is Surging Even as Washington Scoffs

The market leader in stablecoins has increased its market share year-to-date by nearly 15%


Dmitry Rukhlenko/Shutterstock modified by Blockworks


Tether’s stablecoin (USDT) market capitalization hit $81.5 billion on Thursday, marking its highest point since Terra collapse in May 2022. It is currently $2 billion away from the asset’s all-time high of $83.4 billion, set on May 1 last year.

The company has minted $15 billion in new USDT since the start of 2023, seemingly in tandem with a nearly 15% rise in the stablecoin’s market share. This rise was partially due to its nearest rivals — Circle’s USD Coin (USDC) and Paxos-issued Binance USD (BUSD) — seeing a disproportionate amount of their on-chain value redeemed for dollars following separate conflicts.

Tether’s market share stands at 63%, data from Blockworks Research shows — its highest point in 2 years.

Over a billion USDT was minted Thursday, though it has not yet entered circulation, according to a tweet from Tether CTO Paolo Ardoino.

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While the new inventory was earmarked for Ethereum, most USDT lives on Tron — some 45 billion tokens, according to Tether Limited’s transparency page.

Native USDT on the remaining blockchain networks where it is issued — Algorand, Avalanche, Bitcoin Cash’s Simple Ledger Protocol (SLP), EOS, Kusama, Liquid Network, Omni, Polygon, Tezos, Solana and Statemine — comprise a tiny fraction of the supply.

Tether was among the topics discussed at this week’s House Financial Services sub-committee hearing on stablecoins in Washington, D.C., where the overarching theme was on the lack of federal rules for stablecoin issuers in the United States.

Asked by Rep. Warren Davidson, R-Ohio, to explain Tether’s dominance, witness Austin Campbell cited the stablecoin’s “first mover advantage” which allowed Tether to become an “entrenched incumbent.” But he also noted the advantage the issuer has in being located outside the United States.

“Tether has not faced the same kind of regulatory uncertainty,” Campbell, an adjunct assistant professor of business at Columbia Business School, said, adding that a lack of transparency into Tether’s reserves puts users of the stablecoin at risk. “But when they are the default option when others are being hamstrung, it’s what people use because there’s demand for dollars on a blockchain.”

Davidson referred to his past characterization of Tether as a “time bomb” and concluded, “the real opportunity for us is for this body to create legal clarity,” with the goal of making it easier for stablecoin issuers to operate in the United States.

Tether has yet to issue its quarterly attestation for Q1 2023, but its continued growth in the stablecoin market underscores the confidence of market participants, even in the face of starkly worded headlines about Tether’s “deception” and Congressional hand-wringing.
Tether called the report “outdated, inaccurate, and misleading” in a blog post and asserted that “Tether operates under substantial financial regulations.”

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