Tether’s USDt reached a market capitalization of $187.3 billion in the fourth quarter of 2025, amidst structural changes in the crypto market. The main reasons for this are the increase in users and the growth of its use in institutional treasuries.
In the midst of a challenging market where cryptocurrencies like Bitcoin suffered significant declines (6.3%), Tether’s USDT achieved a record market capitalization during Q4 2025. It increased by $187.3 billion, while the overall market contracted by approximately 23.7%. Additionally, it experienced liquidations of $19 billion.
Tether reported annual profits exceeding $10 billion, with some estimates cited during the period reaching as high as $15 billion. Another key point is that the company’s reserves stood at around $193 billion.
User metrics showed an influx of approximately 30 million new users per quarter for eight consecutive quarters, bringing the total reported to nearly 534.5 million wallets. Tether’s share of stablecoin wallets was reported at 70.7%.
Moderation in early 2026 and market dynamics
Despite this growth, Tether’s market capitalization moderated in early 2026 compared to the last quarter of 2025. In 60 days, it contracted by approximately $133 million in early February, representing its first such decline since October 2023. On-chain prices briefly traded below the $1 peg on occasion, suggesting intermittent stress on convertibility and short-term liquidity.
Tether’s ability to expand supply and retain users while the broader market contracted concentrated liquidity and counterparty exposure in a single dominant stablecoin. For crypto treasuries and trading desks, this raises operational considerations: custody and settlement paths may remain concentrated, and episodes of pressure on the peg underscore the need for contingency liquidity plans.
For derivatives and funding markets, a large USDT base supports liquidity in perpetual and spot contracts, but it also amplifies systemic transmission if redemption or conversion stress occurs. Traders should monitor short-term market capitalization flows and anchor deviations as indicators of funding liquidity.
Related: Tether’s Q4 report and on-chain metrics establish a high baseline for market concentration; the coming weeks of flow data and anchor behavior will be closely watched by market participants.
