Tether’s USDT balances fell by $4.6 billion across 19 selected cryptocurrency exchanges and lending platforms during the third quarter, while rival stablecoins expanded their presence through rewards, revenue-sharing agreements and other incentives.
The shift highlights a growing contest for the stablecoin balances used in crypto trading, particularly in derivatives markets. Yet Tether remains the dominant stablecoin in payments, showing that gains made by rivals on exchanges have not translated into a broad loss of its position across the digital-asset economy.
Exchange balances shift toward rival stablecoins
The 19 institutions tracked in the Crystal Intelligence report reduced their USDT holdings by $4.6 billion in the third quarter. Over the same period, they added about $1.9 billion in competing stablecoins, including $569 million of Circle’s USDC and $493 million of Ripple’s RLUSD.
Bybit recorded the largest reduction in USDT, cutting its holdings by $1.66 billion while adding $315 million of RLUSD. Binance reduced its Tether balance by $987 million and increased its USDC holdings by $223 million. OKX lowered USDT holdings by $899 million and added $273 million in USDC.
The changes occurred as stablecoin issuers and their distribution partners offered financial incentives to exchanges and customers. Stablecoins are digital tokens designed to track the value of a fiat currency, usually the US dollar. On trading platforms, they can be used as collateral, a settlement asset and a way to move funds between transactions.
Across the wider market, USDT’s circulating supply declined by $647 million, or 0.4%, to approximately $184 billion during the quarter. USDC’s supply increased by $687 million, while RLUSD grew 59% to $2.5 billion.
Platforms compete for stablecoin income
The competition is especially visible in derivatives, where exchanges can earn additional income from stablecoins deposited as trading collateral.
Hyperliquid’s USDC deposits rose by $1.5 billion during the quarter to approximately $7.2 billion. The increase coincided with an arrangement involving Coinbase and Circle that allows Hyperliquid to receive income from USDC deployed on the platform.
Under Hyperliquid’s Aligned Quote Assets framework, Coinbase acts as the USDC treasury deployer and Circle manages the technical infrastructure. Coinbase shares most of the reserve-linked income with Hyperliquid through payments based on a cost-adjusted reference rate. Crystal Intelligence found that about three-quarters of Hyperliquid’s quarterly USDC increase came from one cluster of linked wallets.
Deribit, a major derivatives exchange, has taken a customer-focused approach. The Coinbase-owned platform added $365 million in USDC during the quarter and expanded its rewards program to roughly 70 additional countries in August. Eligible customers receive monthly payments calculated from their daily minimum USDC holdings.
Other arrangements are also redirecting liquidity. Bybit’s RLUSD holdings increased after a rewards campaign with Ripple launched in July. Bitget and MEXC accumulated USDGO through holding incentives and conversion promotions. In decentralized lending, Spark placed about $247 million in RLUSD into a Morpho vault operated by Sentora. That represented most of Morpho’s $404 million quarterly increase across six stablecoins.
These deals can be costly for issuers. Circle reported approximately $1.4 billion in revenue during the first half of 2026, while distribution and transaction costs reached $819 million, or 59% of revenue. Operating expenses and network investment added another $473 million, leaving about $103 million in net profit.
Coinbase was Circle’s largest distribution partner, with average USDC holdings across its products reaching a record $20 billion in the second quarter, up 44% from a year earlier. Circle later expanded its distribution network through a five-year agreement with Binance, which also invested $100 million in Circle.
Tether keeps the lead in payments
The movement of trading balances has not displaced USDT from its leading role in stablecoin payments. Allium estimated that stablecoins processed $482 billion in classified payments between January and September 2026. USDT accounted for 84% of that total, or approximately $405 billion, compared with $77 billion for competing stablecoins.
USDT also retained substantial liquidity on centralized exchanges. Crystal Intelligence estimated that named exchanges held about $85 billion in tracked stablecoins at the end of September, with Tether representing roughly two-thirds of the total. Binance alone held $41 billion in USDT.
The payment market continued to expand faster than total stablecoin supply. Payment value rose 45% from the corresponding period a year earlier, while transaction counts increased 71% to 1.04 billion. The average payment fell from $544 to $462, indicating a higher number of smaller transactions. September’s $72 billion payment volume was the highest monthly figure in Allium’s dataset. Tron processed about two-thirds of classified payment value.
The contrast leaves Tether with a strong payments and exchange-liquidity base, while rivals are making targeted gains in derivatives, lending and customer deposits. The longer-term competitive balance will depend on whether incentive-backed holdings develop into sustained usage.
Moneyiar market picture
Moneyiar market data at 22:28–22:29 on October 19, 2026, showed Ethereum at $2,408.912353, up 0.85% over 24 hours but down 3.09% over seven days. USDT was priced at $0.998733, down 0.02% in 24 hours and 0.01% over seven days. USDC stood at $0.999902, down 0.01% over 24 hours and unchanged over seven days. Cronos was $0.057431, up 2.72% in 24 hours and down 3.64% over seven days.
