Tether (USDT) Passes Ether in Market Cap as ETH Drops Toward $1.5K

Ether slid to its lowest level of the year on Friday, and the move had an immediate knock-on effect across the market’s largest capitalizations. After a 5.2% drop over 24 hours, ETH’s market capitalization fell below $185 billion, with the token trading around $1,510 on Coinbase, according to TradingView.

That decline allowed Tether’s USDt to overtake ETH for the second-largest spot by market capitalization, with USDt at roughly $186 billion at the time of the flip. Analysts framed the outcome as a reminder that—at least in the current environment—many traders and users are choosing stability over volatility.

Key takeaways

• ETH’s selloff pushed its market capitalization below $185 billion, after a 5.2% 24-hour decline, according to TradingView.
• Tether’s USDt briefly rose to about $186 billion in market cap, overtaking Ether for the second-largest position.
• Market commentary linked the flip to ongoing stablecoin demand, which now represents almost 15% of total crypto market capitalization.
• Ethereum’s broader ecosystem has seen internal restructuring, but new R&D efforts via Ethlabs are also underway.
• Some Ethereum-aligned treasuries continued buying during the weakness, while Circle’s USDC also showed strength relative to XRP.

Why USDt overtook Ether as ETH hit a fresh low

The immediate trigger was Ether’s sharp downward move over a single day. TradingView data cited in the report shows ETH falling to around $1,510 on Coinbase, following the 5.2% crash. With ETH’s market cap dropping below $185 billion, USDt’s approximately $186 billion figure became large enough to move it into the #2 slot.

Bitrue Research Institute’s research lead, Andri Fauzan Adziima, told Cointelegraph that the overtake underscores how the market is currently “favor[ing] stability over ETH’s volatility.” The point wasn’t just about one day of price action—it was about what capital is rewarding in the moment.

Stablecoins keep growing even when the market turns

The USDt-versus-ETH flip aligns with a wider trend: stablecoins are steadily expanding their share of the crypto market. Cointelegraph notes accelerating stablecoin growth, citing that the category accounts for almost 15% of total crypto market capitalization.

In a Thursday post, 21Shares highlighted an important contrast with the last downturn: stablecoin supply contracted by more than 30% during the prior bear market, but is reaching record highs this time. The firm argued that the shift suggests stablecoins have become a defining use case rather than something that depends strictly on the market cycle.

“To us, that is the strongest evidence yet that stablecoins are one of crypto’s defining use cases – demand that no longer depends on the cycle.”

From a liquidity and trading perspective, deeper stablecoin balances can improve on-ramps and off-ramps and help sustain activity during volatility. Alvin Kan, chief operating officer of Bitget Wallet, also pointed to that angle, calling the flip a “notable milestone” reflecting stablecoins’ dominance.

“It demonstrates strong demand for reliable, liquid on- and off-ramps during periods of volatility, while serving as a reminder that ETH must continue delivering compelling utility and narrative momentum to maintain its position.”

Ethereum pressure, but active “buy-the-dip” behavior

While Ether’s price weakness drew attention, several Ethereum-related players reportedly leaned into the decline.

Crypto treasury company Sharplink made its first purchase in eight months, buying 5,000 ETH on Thursday after ETH’s drop. Bitmine, which is chaired by Tom Lee, also continued accumulating: it added 76,881 ETH last week, according to the coverage cited by Cointelegraph.

These actions don’t automatically reverse price trends, but they can be meaningful for sentiment and for how long-horizon holders behave when market conditions deteriorate. If treasuries continue converting into ETH at lower levels, it suggests confidence in the asset’s longer-term role even while short-term volatility punishes holders.

At the same time, the Ether slump has unfolded alongside changes to Ethereum’s institutional structure. Cointelegraph referenced executive departures and a 20% workforce reduction at the Ethereum Foundation. However, it also notes that a new nonprofit organization, Ethlabs, was launched this week by key EF developers and researchers and backed by Ether treasuries Bitmine and Sharplink, pointing to continued efforts focused on Ethereum research and development.

Broader capitalization moves: USDC vs. XRP

Ether wasn’t the only major asset showing relative strength or weakness during the market’s choppy session. The report also states that Circle’s USDC flipped Ripple’s XRP in market capitalization as XRP declined toward $1, its lowest level since November 2024.

At the time of the comparison mentioned in the coverage, XRP’s market capitalization was cited around $64 billion, compared with USDC’s roughly $73.6 billion. For investors tracking stablecoins, the takeaway is similar to what the USDt flip signals: stablecoin demand can be resilient even when other large coins experience extended drawdowns.

Looking ahead, the key question is whether ETH can reclaim critical support levels and sustain momentum, or whether stablecoins continue to widen their grip on market capitalization. Traders and investors will likely watch how stablecoin growth trends evolve alongside Ethereum’s institutional and R&D developments—especially if volatility persists.