Markets
Tether (USDT) Loses Ground on Centralized Exchanges, Dropping to 74% Market Share
Even with several high-profile crashes and de-pegging events in recent years, stablecoins have continued to capture market share from fiat, reflecting increasingly strong demand. While the stablecoin market is still highly concentrated, with Tether’s USDT at the forefront, its dominance has eroded over the past two years.
Indeed, the latest data from Kaiko shows a decline in USDT market share.
Tether (USDT) is slowly losing market share
In 2024, USDT market share on centralized exchanges (CEX) dropped from 82% to 74% according to Kaiko estimates.
This may be due in part to growing competition from stablecoins like FDUSD, which has benefited from Binance’s zero-fee promotions, as well as growing demand for regulated options like USDC.
By the end of June, USDC’s market share had reached an all-time high of 12%, fueled by trading volumes on Binance, Bybit, and OKX. Yield-based stablecoins have also seen growing interest, with issuers like Paxos and Tether introducing their own alternatives in Q2 to meet this demand.
Stablecoin Market Share. Source: Kaiko
USDC Sees Growing Demand
The implementation of the MiCA regulation has increased demand for compliant stablecoins, positioning Circle’s USDC as a key beneficiary. The French blockchain analytics firm recently identified USDC is a leader among regulated stablecoins.
Currently, non-compliant stablecoins make up 88% of the total stablecoin volume, but this is expected to change significantly due to the European Markets in Cryptocurrency Regulation (MiCA), which came into force on June 30. This regulation is likely to push market makers to favor compliant stablecoins over their non-compliant counterparts.
In response, major cryptocurrency exchanges such as Binance, Bitstamp, Kraken, and OKX have already begun delisting non-compliant stablecoins, including Tether’s USDT, for European users. Kaiko data shows that the share of compliant stablecoins has grown over the past year, reflecting a growing preference for more transparent and regulated options, with USDC emerging as the main winner in this evolving market landscape.
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