Circle’s USD Coin (USDC) has overtaken Tether (USDT) in stablecoin trading volume for the first time, according to new data from Visa, as traditional financial institutions increasingly adopt digital currencies for cross-border payments and settlements.
This comes around an increase in stablecoin activity, with overall trading volume jumping 63% in a single month, driven primarily by Wall Street banks integrating blockchain-based payment rails into their operations.
Wall Street integration drives volume spike
The dramatic increase in stablecoin volume reflects growing institutional adoption of blockchain technology for treasury operations and international settlements. Major financial institutions have begun using USDC for same-day settlement of cross-border transactions, reducing costs and settlement times compared to traditional correspondent banking networks.
Circle, the issuer of USDC, has positioned its stablecoin as a compliance-focused alternative to Tether, maintaining full reserves in US Treasury bills and cash deposits held at regulated financial institutions. The company publishes monthly attestation reports from accounting firm Grant Thornton.
Tether, which has dominated stablecoin markets since 2014, has faced persistent questions about its reserve composition and regulatory compliance, though it remains the largest stablecoin by market capitalisation.
Regulatory clarity supports institutional shift
The volume reversal follows recent regulatory developments in the United States and Europe that have provided clearer frameworks for stablecoin issuers. Circle received a federal charter application approval from the Office of the Comptroller of the Currency in January, allowing it to operate as a full-reserve national bank.
Visa’s blockchain analytics division, which tracks stablecoin settlements across multiple networks, recorded USDC volumes exceeding Tether for the first time in its monthly reporting period ending in June. The payments giant has integrated USDC settlement capabilities into its commercial payments platform, enabling clients to move funds between fiat and digital currencies.
While the volume shift is driven primarily by institutional activity in developed markets, stablecoin adoption continues to grow in emerging economies where they serve as inflation hedges and remittance tools. USDC and USDT both operate on multiple blockchain networks, with transaction volumes particularly high in regions experiencing currency volatility.
The Philippines, Nigeria, and Argentina have seen sustained increases in stablecoin transaction volumes over the past year, according to blockchain analytics firm Chainalysis. In these markets, both USDC and Tether serve similar functions, though USDC’s institutional backing may influence its adoption among formal financial service providers.
Circle has not released official commentary on the Visa data. Tether did not respond to requests for comment.
The total stablecoin market capitalisation stands at approximately $187 billion, with Tether holding $119 billion and USDC at $41 billion, according to data aggregator CoinGecko. Market capitalisation and trading volume reflect different metrics, with volume indicating active usage rather than total outstanding supply.