USDC’s on-chain transaction volume has officially surpassed that of USDT. This milestone marks a significant shift in stablecoin market dominance. A new report from investment bank JPMorgan attributes this trend to USDC growth due to regulation and increased institutional demand.
JPMorgan highlights that transparency is a decisive factor. Circle, USDC’s issuer, publishes detailed monthly audits of its reserves. In contrast, Tether has maintained a more reserved stance on its backing. The 2025 figures show USDC’s capitalization grew an impressive 72%, reaching $74 billion. Meanwhile, USDT increased by 32% in the same period. USDC’s market share also advanced from 24% to 30%.
The main driver of this change is the European Union’s MiCA regulation. This framework will take effect in March 2025 for stablecoins. MiCA requires full backing in cash or short-term debt and external audits. Circle has already applied for the MiCA license. However, Tether has not yet completed the required documentation, creating uncertainty among European exchanges.
Is the end of Tether’s market dominance approaching?
Several exchanges in Europe have announced plans to delist non-compliant coins before March 31, 2025. This situation is forcing a redistribution of liquidity. Trading pairs that historically used USDT are migrating toward USDC. Furthermore, institutional preference is clear. Financial entities are seeking assets with transparent audits and regulatory licenses. The USDC growth due to regulation redefines risk profiles in the digital economy.
USDC has also improved its technical adoption. Its integrations on fast networks like Solana and Base facilitate efficient transfers. The JPMorgan report shows a clear trend. Regulation is redefining the balance of power in the sector. The March 31, 2025 deadline is emerging as a turning point. It will be crucial to observe how Tether responds to the European demands.
