Tether released its Q4 2025 USD₮ market report outlining changes in circulation, user activity, and reserve composition during a period of significant stress across the digital asset market.

USD₮’s market capitalization increased by $12.4 billion during the quarter to $187.3 billion. 

Growth was concentrated early in Q4, with October recording 4.9% month-on-month expansion before slowing following the October 10th crypto liquidation cascade. 

Between October 10th, 2025 and February 1st, 2026, the total crypto market capitalization declined by more than one-third, while USD₮ grew by 3.5%. 

Over the same period, the second- and third-largest stablecoins declined by 2.6% and 57%, respectively.

User and Wallet Growth

The estimated number of USD₮ users increased by 35.2 million in Q4 to approximately 534.5 million, marking the eighth consecutive quarter with net user additions above 30 million. 

The estimate includes both on-chain wallet users and users holding USD₮ through centralized platforms such as exchanges.

On-chain wallets holding USD₮ increased by 14.7 million during the quarter to 139.1 million, the largest quarterly increase recorded. 

USD₮ wallets represented 70.7% of all stablecoin-holding wallets. Tether estimated that more than 100 million additional users hold USD₮ through centralized custodial services.

On-Chain Activity and Transfers

Average monthly active on-chain users reached 24.8 million during Q4, accounting for 68.4% of all stablecoin monthly active users. 

The total USD value transferred on-chain using USD₮ rose to $4.4 trillion for the quarter, an increase of $248.6 billion from Q3. Of this amount, 63.6% involved transactions where USD₮ was the sole asset transferred.

The number of on-chain transfers increased to 2.2 billion in Q4. Transfers below $1,000 accounted for 88.2% of transactions, while transfers between $1,000 and $100,000 represented 11.6%. Transactions above $100,000 accounted for approximately 0.2% of total transfers.

Holdings, Velocity, and Use Cases

At the end of Q4, centralized exchanges held 36% of USD₮ in circulation, saver wallets accounted for 33%, and sender wallets represented 26.5%. 

Holdings in DEXs and DeFi declined following the October market disruption, while USD₮’s average on-chain velocity was 28%, with lower velocity tied to exchange and saver balances and higher velocity concentrated in sender and DeFi activity.

Reserves and Asset Composition

The report also detailed Tether’s reserve holdings. Total reserves increased by $11.7 billion during Q4 to $192.9 billion, resulting in net equity of $6.3 billion, defined as assets exceeding liabilities.

Reserve assets included 96,184 Bitcoin, up by 9,850 Bitcoin during the quarter, and 127.5 metric tons of gold, an increase of 21.9 metric tons. 

Tether’s exposure to U.S. Treasuries increased by $6.5 billion in Q4 to $141.6 billion. On a comparative basis, this level of Treasury exposure would place Tether among the largest holders globally if it were classified as a sovereign entity.

Over the full year 2025, Tether reported adding $28.2 billion in U.S. Treasuries, making it one of the largest net buyers of U.S. government debt over the period relative to sovereign nations.

Spot Market Activity

USD₮-denominated spot trading volume on centralized exchanges totaled $3.2 trillion in Q4, a 5.9% decline from Q3. 

However, total spot trading volumes across all digital assets declined by 11.5%, increasing USD₮’s share of total spot volume to 61.5%. Approximately 80% of all spot trades during the quarter involved USD₮.

Overview

According to the report, USD₮ continued to expand its user base, transaction volume, and reserve holdings in Q4 2025 despite broader market contraction. 

The data highlights USD₮’s role across savings, payments, trading, and liquidity management, alongside a reserve structure increasingly concentrated in U.S. Treasuries and other non-digital assets.

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