Tether's USDT Hits 534 Million Users Amid Market Downturn, Fueling Dominance and Stability Debate
Tether's USDT stablecoin has surpassed 534 million users globally, according to its latest quarterly report, marking a significant milestone achieved against the backdrop of a contracting cryptocurrency market.
The stablecoin issuer's Q4 2025 transparency report reveals it added over 35 million users in the final quarter of last year—the eighth consecutive quarter of net additions exceeding 30 million. This growth occurred even as the total cryptocurrency market capitalization fell by roughly one-third following a major liquidation event that began in October 2025.
"We're seeing sustained demand for USDT not primarily for speculation, but for practical applications like savings, remittances, and cross-border settlements," a Tether spokesperson stated in the report. On-chain data appears to support this, showing record-high wallet balances among long-term holders and quarterly on-chain transfer volume reaching $4.4 trillion.
Tether's market capitalization climbed to $187.3 billion in Q4, a $12.4 billion increase, while some competing stablecoins saw outflows. Its total reserves now stand at $192.9 billion, including $141.6 billion in U.S. Treasury holdings—a portfolio that would rank Tether among the world's top sovereign bondholders. The company has also diversified into 96,184 Bitcoin and 127.5 metric tons of gold.
Analysts note that USDT now accounts for 61.5% of spot trading volume on centralized exchanges, cementing its role as the de facto settlement layer for crypto markets. "When traders move between assets, they're mostly doing it through USDT pairs," said Marcus Chen, a senior analyst at Digital Asset Research. "Its dominance creates a liquidity network effect that's hard to disrupt."
However, this concentration brings heightened scrutiny. In early February, USDT's price briefly dipped to approximately $0.9980 on some exchanges—its weakest peg in over five years—sparking discussions about reserve management and market confidence. While the deviation was minor and quickly corrected, it underscored the asset's systemic importance.
"Any sustained loss of confidence in the peg wouldn't just be a Tether problem; it would become a market-wide liquidity crisis," warned financial risk consultant Eleanor Vance. "The entire trading infrastructure is built on this foundation."
Some observers speculate that if current trends continue, USDT could potentially challenge Ethereum's position as the second-largest cryptocurrency by market cap during prolonged risk-off periods. Yet the very growth that fuels this speculation also intensifies the "too big to fail" dilemma facing the ecosystem.
— Reporting contributed by financial markets desk
Market Voices
David Park, Crypto Portfolio Manager (Singapore): "This isn't just growth—it's a flight to safety. When markets tumble, capital moves into USDT as a harbor. Their Treasury holdings are now so vast they're effectively a shadow central bank for crypto."
Rebecca Shaw, Fintech Professor at Stanford: "The user numbers are impressive, but we must distinguish between active users and accounts. Many are exchange-held wallets. The real story is transaction volume—$4.4 trillion in a quarter shows deep utility beyond trading."
Leo "BitcoinMaxi" Rodriguez, Independent Developer (Twitter commentary): "This is a ticking time bomb. A single, opaque company controlling the lifeblood of crypto? The brief depeg was a warning shot. We're building a decentralized future on a centralized fault line."
Anika Patel, Remittance Startup Founder (Nigeria): "Forget the trading talk. In markets like ours, USDT is digital dollar access. The growth reflects real people using it to save and send money because traditional systems have failed them."