The cryptocurrency payments landscape witnessed a significant shift in 2025, as Tether's USDT steadily eroded the market share of Circle's USDC on BitPay, the leading crypto payment processor.
Market Share Reversal: USDT Gains Ground Against USDC
- 2024 Dominance: USDC commanded 85% of BitPay's stablecoin transactions in January 2024, dwarfing USDT's 13% share.
- 2025 Decline: By May 2025, USDC's share plummeted to 56%, while USDT surged to 43% – marking a 29% swing in just 16 months.
This reversal occurred despite Circle's high-profile IPO in June 2025 and its first-mover advantage in European MiCA compliance. 👉 Learn how MiCA impacts stablecoin adoption
Volume Leadership: USDT Outperforms in Payment Value
BitPay's transaction data reveals more than just share shifts:
- Volume Supremacy: USDT processes over 70% of stablecoin payment value since March 2025
- User Preference Shift: Existing merchants increasingly favor USDT over USDC
- Geographic Factors: European users show stronger USDT adoption despite MiCA challenges
"While USDC remains our most transacted stablecoin, USDT's volume dominance reflects changing merchant preferences," noted Bill Zielke, BitPay's Revenue Director.
Regulatory Divergence: Two Paths to Growth
| Factor | Circle (USDC) | Tether (USDT) |
|---|---|---|
| Regulatory Approach | MiCA-compliant since July 2024 | Criticizes MiCA compliance |
| Corporate Strategy | Public via June 2025 IPO | No plans for IPO |
| Market Response | 88% annual market cap growth | 40% annual market cap growth |
Despite BitPay's trends, USDC's market capitalization grew 41% year-to-date in 2025 versus USDT's 15.5% increase – suggesting divergent adoption patterns across different platforms.
FAQ: Stablecoin Payment Trends
Q: Why are merchants shifting to USDT?
A: BitPay cites lower volatility periods and growing liquidity pools as key drivers.
Q: How does MiCA affect USDT's European usage?
A: While still accessible, USDT faces restrictions with EU-licensed exchanges under new MiCA rules.
Q: Will Circle regain its BitPay lead?
A: Market analysts suggest USDC's regulatory clarity may eventually outweigh USDT's current momentum. 👉 Explore stablecoin market dynamics
Note: All investment decisions involve risk. This analysis represents market observations, not financial advice.