{"id":14662,"date":"2026-10-19T17:11:52","date_gmt":"2026-10-19T17:11:52","guid":{"rendered":"https:\/\/cryptonews.uk.com\/?p=14662"},"modified":"2026-10-19T17:11:52","modified_gmt":"2026-10-19T17:11:52","slug":"tether-loses-nearly-5-billion-across-crypto-exchanges-as-usdc-and-rlusd-rivals-pay-to-win-liquidity","status":"publish","type":"post","link":"https:\/\/cryptonews.uk.com\/?p=14662","title":{"rendered":"Tether loses nearly $5 billion across crypto exchanges as USDC and RLUSD rivals pay to win liquidity"},"content":{"rendered":"

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Tether lost $4.6 billion in USDT supply across 19 selected cryptocurrency exchanges and lenders during the third quarter as rival stablecoins gained ground.<\/p>\n

During the same period, the 19 institutions added approximately $1.9 billion in competing tokens, including $569 million of Circle’s USDC and $493 million of Ripple’s RLUSD.<\/p>\n

According to the Crystal Intelligence report, Bybit recorded the largest reduction, shedding $1.66 billion in USDT while adding $315 million of RLUSD. Binance reduced its Tether holdings by $987 million and acquired $223 million of USDC, while OKX cut $899 million in USDT and added $273 million of USDC.<\/p>\n

Across the wider market, USDT’s circulating supply fell $647 million, or 0.4%, to about $184 billion during the quarter. Meanwhile, RLUSD rose 59% to $2.5 billion, while USDC gained $687 million.<\/p>\n

\"Stablecoin\"Stablecoin
Stablecoin Market Performance in Q3 (Source: Crystal Intelligence)<\/figcaption><\/figure>\n

The changes reflect growing competition for cryptocurrency trading balances, as issuers and their distribution partners offer financial incentives to exchanges and customers who hold their tokens.<\/p>\n

Crypto exchanges increasingly profit from stablecoin holdings<\/h2>\n

The competition has become especially visible in cryptocurrency derivatives markets, where stablecoins serve as trading collateral and can generate additional income for platforms that hold customer deposits.<\/p>\n

Hyperliquid, a leading derivative trading platform, recorded a $1.5 billion increase in USDC deposits during the quarter, bringing its holdings to approximately $7.2 billion.<\/p>\n

The growth coincided with an arrangement between Coinbase and Circle that lets Hyperliquid receive income from USDC deployed on the platform.<\/p>\n

Under Hyperliquid’s Aligned Quote Assets framework, Coinbase serves as USDC’s treasury deployer, while Circle manages the technical infrastructure. Coinbase shares most of the reserve-linked income with Hyperliquid, with the arrangement specifying payments based on a cost-adjusted reference rate.<\/p>\n

That provides Hyperliquid with revenue tied to the collateral supporting its derivatives business. Crystal found that approximately three-quarters of the platform’s quarterly USDC increase came from one cluster of linked wallets.<\/p>\n

Deribit, the largest derivatives trading exchange, has adopted a different strategy, rewarding customers directly for maintaining USDC balances. The Coinbase-owned platform added $365 million in USDC during the quarter and expanded its rewards program to approximately 70 additional countries in August.<\/p>\n

Under the program, qualifying customers receive monthly payments calculated using their daily minimum USDC holdings.<\/p>\n

Other issuers are pursuing similar arrangements. Bybit’s RLUSD holdings increased following a rewards campaign launched with Ripple in July, while Bitget and MEXC accumulated USDGO through holding incentives and conversion promotions.<\/p>\n

The competition extends into decentralized lending. Spark placed\u00a0about $247 million in\u00a0RLUSD into a Morpho vault run by<\/span>\u00a0Sentora, accounting for most of Morpho’s $404 million quarterly increase across six stablecoins.<\/p>\n

These commercial agreements are becoming increasingly expensive for issuers seeking access to exchanges, lending platforms and their customers.<\/p>\n

Circle’s own financial results illustrate the rising cost of competing for stablecoin distribution. The company generated about $1.4 billion in revenue in the first half of 2026 but spent $819 million, or 59% of that amount, on distribution and transaction costs.<\/p>\n

Another $473 million went to operating expenses and network investment, leaving Circle with about $103 million in net profit, or just seven cents of every revenue dollar.<\/p>\n