Circle’s USDC added roughly $2 billion in supply during the first quarter of 2026, pulling ahead of rival Tether at a moment when the broader crypto market was contracting. It marked the sharpest divergence between the two largest stablecoin issuers since the bear market of mid-2022.
USDC Gains As Tether Loses Ground
Stablecoins also captured 75% of all crypto trading volume in Q1, the highest share ever recorded. Data shows investors rotated into dollar-pegged assets as a defensive move, choosing to stay inside the crypto ecosystem rather than exit it entirely.
Yield-Bearing Products Fuel New SupplyA significant portion of fresh issuance came not from USDC or USDT, but from yield-bearing stablecoins — products that pay returns similar to interest-bearing accounts.
That segment is now valued at around $3.7 billion, with daily trading volumes exceeding $100 million, based on CoinGecko data.
The debate is unresolved, and its outcome could determine how much room yield-bearing products have to grow inside the US market.
Not all of the quarter’s numbers pointed upward. Retail-sized transfers — those associated with individual users — fell 16%, the steepest single-quarter decline on record.
Automated trading and algorithmic activity filled much of that gap, accounting for approximately 75% of all stablecoin transaction volume during the period.
CEX.io’s report frames the overall picture as one of structural growth under pressure — a market where institutional and automated flows are increasingly driving the numbers, even as everyday participation fades.
Featured image from Meta, chart from TradingView
