The stablecoin sector is flashing mixed signals. On one hand, top issuers like Tether, Circle, and decentralized protocols are generating hundreds of millions in monthly revenue. On the other, the total market capitalization of U.S. dollar-pegged stablecoins has contracted by roughly $10 billion since the start of 2025, as capital rotates into the U.S. stock market.
Data from CoinGecko cited by on-chain analyst EmberCN shows that Tether’s USDT supply fell from $189.8 billion to $184.1 billion year-to-date – a $5.7 billion drop – while Circle’s USDC decreased by $6.6 billion. That combined reduction accounts for the bulk of the stablecoin market's decline. In contrast, the newer stablecoin USD1 added $500 million over the same period, largely driven by centralized exchange incentive programs offering interest-bearing accounts.
Despite the shrinking supply, stablecoin-centric projects continue to print substantial revenues. Over the last 30 days, Tether led all crypto projects with $439.2 million in revenue, followed by Tron ($232 million) and Circle ($188.3 million). Other notable earners include Hyperliquid ($68.3 million), Sky – formerly MakerDAO ($35.4 million), and Ethena ($18.1 million). Revenue came mainly from returns on stablecoin reserves and decentralized stablecoin infrastructure fees.
The $10 billion drop in stablecoin supply is often seen as a reduction of dry powder within the crypto ecosystem, potentially limiting buying pressure. The parallel rally in U.S. equities suggests investors are reallocating funds from digital dollars to traditional stocks, reflecting a shift in risk appetite. Whether this trend persists will depend on macroeconomic developments and the relative attractiveness of different asset classes.
