Stablecoin supply tops $300 billion but growth stalls as Tether gains at rivals’ expense

The total stablecoin supply has just surpassed the $300 billion mark, with Tether's (USDT) adding over $5 billion in the last month. Yet despite Tether’s growth, the supply of USDC, USDe, and PYUSD together declined by roughly $4.2 billion over the same period.

All things considered, a net category growth of nearly $900 million, the equivalent of a 0.3% growth of the total supply over the past month, could be considered a stall, with overall supply not meaningfully expanding even as Tether kept printing.

Every marginal stablecoin dollar entering the system is a USDT dollar replacing a redeemed (USDC), (USDe), or (PYUSD) dollar.

USDe's collapse is also a structural story worth noting. Down 28% in the last month and almost 34% year to date, Ethena's synthetic dollar has experienced sustained outflows, notably since October 2025.

The mechanism, where USDe's yield depends on positive perpetual funding, has deflated with crypto perp funding compressed after the Oct. 10 deleveraging event.

USDe's yield simply cannot compete with overcollateralized alternatives, with the supply of Sky's USDS (+48.9% year to date) and World Liberty Financial's USD1 (+33.7%) absorbing the bulk of the rotation. PYUSD's supply has also declined by 13% over the last month, as its institutional distribution thesis has not driven supply growth.

As aggregate stablecoin supply has stalled with only Tether's USDT growing, the bank-issued and GENIUS Act-compliant stablecoin entrants have had a harder start than many expected.

If these new stablecoin issuers want to directly displace USDT’s market share, they would have to offer higher yields, better distribution channels, or regulatory wedges that USDT cannot match, though none of the current second-tier stables have shown those capabilities yet.