Ethereum Dominates as Tether’s USDT Chain of Choice - Leaving Other Networks in the Dust

Ethereum just cemented its position as the undisputed heavyweight for stablecoin settlement. The network now processes more USDT transactions than all other blockchains combined—a staggering dominance that reshapes the DeFi landscape.

The Scaling Advantage

Ethereum's layer-2 ecosystems are swallowing volume that once flowed to alternative chains. Faster settlements and lower fees are pulling institutional players who previously hedged their bets across multiple networks.

Network Effect in Action

This isn't just about technology—it's about liquidity concentration. As more USDT settles on Ethereum, the gravitational pull strengthens. Competing chains are watching their stablecoin relevance evaporate overnight.

Meanwhile, traditional finance institutions are still trying to figure out whether 'gas fee' refers to their corporate fuel cards. The migration proves that when real money moves, it follows infrastructure—not marketing hype.

Institutional adoption fuels ETH dominance as the preferred network for USDT

Retail traders have largely favored Tron for its low fees against Ethereum’s institutional-grade infrastructure with higher transfer fees. Despite that, ETH has maintained deep liquidity and an extensive DeFi ecosystem reach. Other notable chains include the BSC chain, which holds 7.48% of the USDT supply, and Plasma (XPL), with a supply of $4.37 billion. solana has remained low, capturing only $2.1 billion of the USDT supply, according to data on DeFiLlama.

📈🔝 @Tether_to's USDT on @ethereum is back as the biggest stablecoin deployment by supply.

The supply of USDT on ethereum has increased by ~$17 billion since May. pic.twitter.com/1wS2RZ1FA3

— Token Terminal @ TOKEN2049 🇸🇬 (@tokenterminal) September 26, 2025

Ethereum’s daily USDT transactions average around 400K, while overall network transactions surpassed 1.64 million today. This shows its active use in payments and settlements across the DeFi ecosystem. Tron, however, still dominates in terms of daily transactions. 

Institutional adoption of Ethereum has fueled the reversal, with companies like PayPal integrating PYUSD stablecoin into Ethereum, currently leading with $1.75 billion in supply. The scale of USDT volumes on Ethereum influences cross-chain bridge activity, liquidity provision, and exchange integration. Ethereum’s ability to capture institutional stablecoin flows positions it as the primary settlement layer for institutional financial applications as TradFi adopts blockchain-based payments.

Tether remains the global leader in the stablecoin market with a market cap of $174 billion. Circle’s USDC follows in the second position with $74 billion. The two tokens dominate the stablecoin market, although they have different strategies. 

GENIUS Act pushes broader stablecoin competition

Tether first launched in 2014 as RealCoin before changing that name later. It gained market traction quickly after becoming the preferred tool for moving money between different cryptocurrencies, mainly due to its speed of settlements and lower fees. It has also faced controversies, including regulatory fines and concerns over its reserves. The token has now grown to be offered on over 90 networks.

Circle’s USDC, launched in 2018, is focused on compliance and transparency. It publishes monthly attestations while maintaining a close partnership with American financial institutions. Circle went public in June, listing on the New York Stock Exchange (NYSE) and raising over $1 billion on its IPO. The firm has positioned itself as the regulated alternative to Tether.

The U.S. regulatory framework has boosted the growth in stablecoin competition. The GENIUS Act, signed into law by President Trump in July, established a comprehensive standard for stablecoins to meet. Cryptopolitan covered the story, highlighting that the act requires stablecoin firms to disclose monthly public reserves, third-party attestations, and strict limitations on asset composition. Circle was already largely compliant with these requirements. Tether has, however, is launching another U.S.-compliant token, USAT, while issuing USDT for the global market. 

Tether has managed to maintain strong financial results, with billions in quarterly profits generated mainly from its holdings of U.S. Treasuries. The firm has established itself as one of the largest holders of U.S. debt, with more than $24 billion invested in short-term Treasury bills since July. Circle’s USDC, however, is lagging mainly due to its revenue-sharing model with partners, despite gaining institutional trust due to its transparency and regulatory compliance.

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