How Tether’s $142 billion USDT supply affects Bitcoin liquidity

USDT liquidity and Bitcoin accumulation

Tether’s USDT supply is $142 billion. This liquidity influences Bitcoin’s on-chain environment. Tether holds 3.09% of its assets in Bitcoin. In 2025, the company assigned 15% of net realized profits toward Bitcoin purchases. On-chain records show Tether moved 951 bitcoin, valued at $70.5 million, from a Bitfinex hot wallet into a reserve wallet. These reserve addresses hold about 97,141 BTC. This strategy removes coins from exchange liquidity and moves them into long-term custody. In early 2026, the company added about 8,888 BTC to its holdings. Tether’s strategy emphasizes safety and yield, and the company generated over $10 billion in profits for the first nine months of 2025. This makes Tether the 17th largest holder of US Treasuries globally.

Plasma is building a Bitcoin-based blockchain for stablecoin transactions to solve high fees and network congestion. The project raised $24 million in funding led by Framework Ventures. Bitfinex and Peter Thiel also participated in this funding round. Utexo manages the rollout of this Bitcoin-based USDT through RGB technology. This technology keeps payment details between the sender and receiver. Only a small digital fingerprint stays on Bitcoin’s public record. This move expands Tether’s Bitcoin support. The new version promises private payments. Bitcoin deserves a stablecoin that feels native, lightweight, and scalable.

Liquidity dominance and regulatory shifts

USDT accounts for 74% of stablecoin trading volume on centralized exchanges. The US GENIUS Act wiped an estimated $300 billion off the market value of incumbent payment firms because the law requires one-to-one reserves in cash and short-term US Treasuries. The total stablecoin market capitalization is $308 billion as of August 13, 2026, which is 4.5% below the May 2026 peak of $322.4 billion, despite a 14.3% increase over the previous twelve months. Stablecoin transfers in 2025 reached $33 trillion. In February 2026, stablecoin settled $7.2 trillion, which surpassed the US ACH network for the first time.

Asia remains the largest stablecoin-flow region with $12.5 trillion in 2025. Most of these flows occur outside the US. In Venezuela, 90.2% of active Binance P2P order book volume for VES fiat pairs uses USDT, making it the primary retail settlement mechanism in the country. The Stablecoin Supply Ratio stood at 4.16 as of August 13, 2026. This ratio compares Bitcoin’s market capitalization to total stablecoin supply. Forty-one percent of businesses that use stablecoins report cost savings of 10% or more. Cross-border B2B stablecoin payments are projected to reach $5 trillion by 2035. In 2026, these payments reached $13.4 billion. Real-economy payments on Tron account for 60% to 80% of flows. This share fell from 74% in January 2025 to 60% by the end of 2025. You should monitor how these regulatory shifts affect your own liquidity providers.

The European landscape and MiCA compliance

EUR-denominated stablecoins grew 12 times in volume from January 2025 to March 2026. This growth reached $777 million per month. Tether discontinued its EURT stablecoin in late 2024. Redemptions for EURT ended in November 2025. The European Markets in Crypto-Assets (MiCA) regulation drove this decision. MiCA requires e-money tokens to have a licensed issuer and 1:1 fiat reserves. EURI is a MiCA-compliant token that became the third-largest stablecoin by market capitalization. Other MiCA-compliant tokens include EURQ, EURCV, EURE, and EURR. These tokens use regulatory clarity to attract institutional adoption in Europe.

The market for EUR-denominated stablecoins is growing as users seek alternatives to USD-based rails. EURI, EURQ, and EURR are all MiCA-compliant. The regulatory framework for the European Union, known as MiCA, provides clearer rules for issuance and compliance, which reduces uncertainty for both issuers and users while enabling more formal integration with regulated platforms. In 2025, USD-denominated stablecoins at retail VASPs totaled $310 billion. By March 2026, that figure fell to $274 billion. This decrease reflects a broader market contraction. In contrast, the EUR-denomenuated volume rose from $69 million in January 2025 to $777 million in March 2026. Other major players include Sky Dollar (USDS) at $6.9 billion and Ethena USDe at $6.1 billion. Other assets like EURS and EURA fail to meet MiCA requirements. EURS does not appear on the ESMA EMT register. EURA is a decentralized token whose protocol is being wound down. Will the rise of MiCA-compliant assets eventually erode the dominance of USD-pegged tokens?

Comparing Tether and Circle reserves

Tether and Circle maintain different reserve compositions. Tether reported $141 billion of US Treasury bill exposure as of March 31, 2026. Its reserves also include 10.03% in precious metals and 7.17% in secured loans. Tether also holds 2.79% in other investments and 2.00% in public equities. The company had a $41 million CFTC settlement in 2021. USDC holds roughly one-third in Treasuries and the rest in overnight repo and cash. Circle is a US-based, publicly traded company. Circle publishes monthly attestations through Deloitte. Tether is based in the BVI and El Salvador. USDT leads by supply with 59.1% of the market. USDC follows with 23% of the market. Together, they control 82% of the market. USDT provides deeper exchange liquidity and wider trading pair coverage. USDC provides tighter reserve reporting and a regulated structure. In 2025, USDC processed $18.3 trillion in annual transaction volume compared to USDT’s $13.3 trillion.

The market concentration is high. Two issuers control 85% of the supply. Most of the activity happens on Ethereum and Tron. Ethereum holds 48.7% of the supply. Tron holds 31% of the supply. USDT has 136 million holders. USDC has 36 million holders. Total unique holders across the 15 major stablecoins exceed 172 million addresses.