USDT, the largest stablecoin by circulation, has surpassed Ethereum in market capitalization, according to data tracked by Arkham Intelligence. The shift marks the first time a stablecoin has overtaken ETH in total market value, underscoring changes in how capital is distributed across crypto assets.
USDT, the largest stablecoin by circulation, has surpassed Ethereum in market capitalization, according to data tracked by Arkham Intelligence. The shift marks the first time a stablecoin has overtaken ETH in total market value, underscoring changes in how capital is distributed across crypto assets.
Arkham’s on-chain data dashboard shows USDT’s fully diluted market capitalization now exceeds that of Ethereum’s native token, ETH. Market capitalization in crypto represents the total dollar value of a token’s circulating supply, calculated by multiplying the current price by the number of tokens outstanding. For related coverage, see TRON Surpasses Ethereum in USDT Transaction Volume.
The distinction matters because USDT and ETH operate on fundamentally different models. USDT is a dollar-pegged stablecoin issued by Tether, meaning its market cap grows primarily through new token issuance rather than price appreciation. ETH, by contrast, is a volatile asset whose market cap fluctuates with its trading price. For related coverage, see TRON TVL Surpasses $6.37B Amid Increased Activity.
Two key points summarize the development:
Tether’s USDT supply has expanded steadily, with the company publishing transparency reports on its reserve backing. Each new USDT minted adds directly to the stablecoin’s market capitalization at a near 1:1 dollar ratio, making supply growth the primary driver of its market cap increases. For related coverage, see TRON Achieves Record $611B USDT Activity in May 2025.
Ethereum’s market cap, meanwhile, depends on ETH’s trading price. A period of slower price appreciation or decline can shrink ETH’s total valuation even if network usage remains stable. The crossover reflects these two dynamics converging: rising stablecoin supply meeting a relatively flat or declining ETH price.
This distinction is critical for interpreting the ranking. A stablecoin overtaking a network asset does not mean USDT “outperformed” Ethereum in the traditional sense. It signals that dollar-denominated liquidity flowing into crypto through stablecoins has grown large enough to exceed the market’s valuation of ETH at current prices.
The trend extends beyond market cap. USDT activity on competing chains has also grown, with USDT supply on Tron surpassing Ethereum earlier in 2025. Similarly, TRON has overtaken Ethereum in USDT transaction volume, reflecting a broader redistribution of stablecoin activity across networks.
USDT serves as the primary trading pair and settlement layer across most centralized and decentralized exchanges. Its market cap growth reflects demand for dollar-denominated liquidity, which traders use to enter and exit positions across the crypto market.
A stablecoin surpassing ETH in market value suggests that a significant share of capital in crypto is parked in stable, liquid instruments rather than deployed into volatile network tokens. This can indicate cautious market positioning, where participants hold dry powder in USDT rather than rotating into assets like ETH.
Ethereum’s utility as a smart-contract platform and the base layer for decentralized finance remains unchanged by this ranking shift. The network continues to anchor a large share of DeFi activity, and institutional products like the BlackRock Ethereum ETF demonstrate ongoing institutional interest in ETH as an asset class.
The ranking does, however, highlight how stablecoin infrastructure has scaled. Tether’s growth, combined with record USDT activity on networks like TRON, positions stablecoins as one of crypto’s most significant use cases by capital deployed.
Whether the market cap gap widens or narrows will depend on two variables: the pace of new USDT issuance and the direction of ETH’s price. A sustained ETH rally could reverse the ranking, while continued stablecoin demand would keep USDT ahead.
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency and digital asset markets carry significant risk. Always do your own research before making decisions.
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