USDC Surges Past USDT in 2025 Growth Race as Institutional Demand Skyrockets
Stablecoin dynamics flipped this year—USDC's growth trajectory left USDT in the dust. Institutional capital finally got serious about on-chain dollars, and the numbers don't lie.
The Regulatory Premium Pays Off
Transparency and compliance, once seen as burdens, became the ultimate selling point. While other assets danced with volatility, regulated stablecoins offered a digital harbor. Treasury departments started moving in.
Infrastructure Catches Up to Ambition
Enterprise-grade rails and clearer custody solutions removed the final barriers. The 'institutional on-ramp' shifted from a buzzword to a functioning highway. Money flowed where the friction was lowest.
A New Benchmark for Digital Liquidity
The race is no longer just about volume—it's about quality and trust. The market voted with its capital, favoring assets that could withstand a regulator's glare. It turns out that in finance, boring compliance can be the most exciting growth driver of all. A cynical take? The institutions finally arrived—just in time to demand the same old, boring assurances they've always loved.
Analysts credit USDC’s performance to increased institutional demand
Analysts have credited USDC’s recent growth to the rising demand for stablecoins from an institutional level, alongside a streamlined regulatory environment surrounding the issuance of stablecoins. The U.S. government passed the GENIUS (Guiding and Establishing National Innovation for U.S. Stablecoins) Act in July 2025, paving the way for a warmer environment for stablecoin issuance and usage.
Observers note that the GENIUS Act established a comprehensive framework for introducing stablecoins pegged to a real monetary value. The new regulations allowed several banking institutions in the jurisdiction to explore regulated stablecoins such as USDC. The crypto asset is now accessible to companies such as Visa, Mastercard, and BlackRock for treasury operations and powering transactions.
According to data from crypto data aggregator CoinGecko, Tether’s USDT still reigns as the largest stablecoin in market capitalization. The data shows that the stablecoin’s market cap is around $187.3 billion, while that of USDC is $75.8 billion as of the time of this publication.
The two stablecoins have a combined market capitalization of over $260 billion, equivalent to more than 80% of the global stablecoin market cap. The data also shows that Tether’s USDT has outperformed Circle over the last 24 hours, with a trading volume of $91.3 billion, while Circle’s stands at $15.6 billion.
However, USDC’s market capitalization increased by 73% in 2025 to $75.12 billion, while USDT’s market cap ROSE by 36% to $186.6 billion. In 2024, USDC grew by 77% while USDT trailed behind with a 50% growth.
Circle Internet is the financial technology company responsible for developing and issuing USDC. The company is based in New York and is publicly listed on the New York Stock Exchange. The company backs the stablecoin with cash and short-term U.S. Treasury securities held at regulated entities.
Circle’s compliance boosts USDC’s appeal among regulated entities
Circle is the primary beneficiary of eased stablecoin regulatory scrutiny. The company has received regulatory greenlight in several states and territories in the U.S. through money transmission licenses.
The company also complies with the European MiCA framework and conducts activities under e-money licences in major regions. On the other hand, Tether has not yet received regulatory greenlight in the U.S. or the European Union. The company operates as a licensed digital asset service provider in El Salvador.
Previous remarks by analysts at JP Morgan highlighted USDC as the go-to stablecoin for institutional investors and regulated entities due to its transparent reserve management and regular audits. The analysts also noted that the stablecoin’s compliance with Europe’s MiCA regulations makes it suitable for use by financial institutions.
As previously reported by Cryptopolitan, Ethereum-based stablecoins experienced peak activity in 2025, with constant growth throughout the year. The report highlighted that the activity was an extension of a notable trend showing the assets’ steep growth in recent months. The number of active addresses reached a new high on several occasions last year, with more than 590,000 active wallets moving stablecoins daily.
The year saw stablecoins behave abnormally in a way not witnessed during past market cycles, in terms of both total supply and the magnitude of usage. During the year, over $314B in stablecoins were in circulation, with much more diversified destinations, unlike previous market cycles.
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