USDC Outpaces USDT in Blockchain Growth

According to JPMorgan analysts, the Circle USDC stablecoin is growing faster than Tether’s USDT in both on-chain activity and market capitalization, driven by clearer regulatory frameworks and increasing institutional adoption.

USDC’s market cap has risen from around $43 billion in January to approximately $74 billion today — a 72% increase, compared to USDT’s 32% growth over the same period, the report led by Nikolaos Panigirtzoglou revealed. The divergence reflects a broader market shift toward stablecoins prioritizing transparency, compliance, and regulatory assurance.

“USDC’s transparent reserve management and regular audits have strengthened trust among institutional investors and regulated entities,” analysts wrote.
“Moreover, USDC’s compliance with regulations such as the EU’s MiCA framework distinguishes it from competitors, making it the preferred stablecoin for financial institutions.”

The analysts noted that MiCA regulation, which came into effect in July 2024, accelerated the gap in velocity (on-chain transaction volume relative to market cap) between USDC and USDT.

“Since then, USDC’s transaction speed and network activity have been rising, further boosted last summer by the enactment of the U.S. Genius Act,” they added.

USDT, which was not MiCA-compliant, faced delistings from major exchanges following the regulation, while USDC gained momentum thanks to integrations with Visa, Mastercard, Stripe, and other payment networks enabling blockchain-based settlements.

USDC’s growth has also been supported by its presence on Solana and Base, where DeFi activity has surged. Additionally, Circle’s Cross-Chain Transfer Protocol (CCTP) facilitates secure, non-custodial transfers of USDC between blockchains.

Outside the U.S., however, USDT continues to dominate as the primary trading pair in emerging markets, maintaining a higher trading velocity on centralized exchanges.

“A higher USDT ratio indicates broader exchange use outside the U.S. However, its dominance could be threatened if USDC’s model sets the global standard for the next generation of stablecoins,” the analysts noted.

Tether plans to launch USAT, a fully Genius Act-compliant stablecoin, by the end of the year. In a previous note, JPMorgan said that the upcoming launches of USAT, USDH by Hyperliquid, and other fintech-issued stablecoins will intensify competition for Circle.
Still, analysts believe this competition will likely remain a “zero-sum game”, as U.S. issuers will mostly swap market share unless the overall crypto market expands significantly.

See also: "Bitcoin Price Today: Stalls at $110K with October Losses"

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