Tether Unleashes $5 Billion USDT Surge Following Fed’s First Rate Cut of 2025

Tether just dropped a bombshell response to the Fed's monetary policy shift—minting a staggering $5 billion in USDT within hours of the central bank's first rate cut this year.

The Crypto Countermove

While traditional markets were still digesting the Fed's decision, Tether executed what amounts to the largest single minting operation of 2025. The stablecoin giant effectively bypassed the traditional banking system's liquidity channels, deploying digital dollar equivalents at scale precisely when traditional liquidity becomes cheaper.

Market Mechanics Unleashed

This isn't just printing money—it's programming liquidity. The minting signals massive anticipated demand for crypto exposure as yield-seeking capital rotates out of traditional instruments. Exchanges immediately saw USDT pairs light up with buying pressure across major cryptocurrencies.

The DeFi Domino Effect

Protocols across Ethereum, Solana, and emerging Layer 2s braced for incoming liquidity waves. lending rates on Aave and Compound began compressing within hours as the new USDT hit markets. Arbitrage bots scrambled to capture spreads across decentralized exchanges.

Because nothing says 'efficient markets' like a private company issuing $5 billion in digital dollars while traditional banks still require three business days to clear a wire—the future of finance isn't coming, it's already here and it doesn't wait for banking hours.

Tether Expands USDT Supply by $5 Billion in a Week

This added to the $4 billion minted before the Federal Open Market Committee (FOMC) meeting on September 17.

At that meeting, Federal Reserve Chair Jerome Powell announced a 0.25 percentage point reduction in the benchmark rate—the first cut of 2025—and suggested that further easing could follow.

The move, which reduces borrowing costs, is often interpreted as a potential catalyst for risk assets, including cryptocurrencies.

Market experts note that stablecoins like USDT typically benefit in such environments because they function both as a gateway into crypto markets and as a liquidity refuge during volatile periods.

As a result, Tether’s rapid issuance during the week reflects more than a mere expansion, as it signals investor positioning ahead of shifting macroeconomic conditions.

Meanwhile, the latest minting has altered the balance of stablecoin distribution across blockchains.

Data from DeFiLlama shows ethereum now hosts $81 billion worth of USDT, accounting for 45% of total circulation. That edge places it ahead of Tron, which holds $78.6 billion or 43.7%.

Meanwhile, smaller allocations remain on Binance’s BNB Chain and Solana.

This distribution strengthens Tether’s dominance in the $292.6 billion stablecoin sector, where USDT alone represents nearly 59% of the market with $172 billion in supply.

Unsurprisingly, Tether CEO Paolo Ardoino touted USDT’s accelerating adoption in the space.

USDT brings digital dollar savings to the world, adding 2.9x more new $1+ holders than all other stablecoins combined over the past 90 days pic.twitter.com/aIFleIkNFB

He revealed that in the past 90 days, more than 3.5 million new wallets began holding at least $1 of USDT—almost triple the combined growth of rival stablecoins.

That surge underscores the issuer’s growing dominance, reinforcing its position at the center of crypto liquidity.