Circle's USDC could soon displace USDT as top liquidity provider for BTC trading pairs

Circle’s USDC stablecoin is changing the balance of the BTC market. The token is more widely used in liquidity pairs, supporting 25% of the available 1% liquidity depth. 

The fully regulated stablecoin by Circle is becoming more important for the BTC market. The stablecoin is displacing fiat pairs in terms of activity, while securing a growing part of the 1% market depth. 

Circle has gained market share in 2025

For the first half of 2025, the share of USDC in securing BTC liquidity rose from around 15% to 24%. The share of USDT remained flat for the first half of the year. 

Liquidity for USDC-denominated trading pairs is steadily climbing across crypto markets.

BTC-USDC now accounts for 24% of total 1% market depth on major exchanges, up from 15% six months ago. 📈 🌊📈 pic.twitter.com/yI9bOf5nXo

— Kaiko (@KaikoData) July 1, 2025

The influence of USDC expanded, as the total supply returned to levels from 2023, erasing the effect of the bear market and lowered demand. 

The stablecoin currently carries around 10.5% of all BTC trading volume, though the activity metric diverges from the available depth.

Volumes for USD pairs account for over 19% of BTC daily volumes, mostly due to Coinbase’s influence. Trading volumes are also open to brief anomalies or days of record trading, as in the case of USD1, which briefly surpassed Circle USD in 24-hour trading. 

USDC expands its influence with growing supply

The share of USDT has fallen to around 37% of all volumes, down from its usual levels above 50%. Currently, FDUSD is also highly active, with a 300% daily turnover of its entire supply. FDUSD, however, remains limited to Binance trading pairs. 

USDC is currently expanding its presence and activity levels, rising to a higher baseline in 2025. USDC achieves $5B to $7B in daily trading, with varying activity in both centralized and decentralized pairs. 

Currently, USDC is also highly active for swaps against USDT, reflecting demand for fully regulated tokens, the only type that can be used in some regions. The usage of USDT also coincided with the expansion of EURC, the Euro-linked stablecoin minted by Circle. 

USDC is also spreading to a wider selection of holders. In 2025, almost every month has seen an expansion of wallets holding Circle dollar stablecoin. Most of the Circle-issued USD is held in personal end-user wallets, with around 54K smart contracts supplied with the token. 

One of the sources of USDC growth is its usage on Hyperliquid. Nearly 3B Circle USD were deposited on the perpetual futures DEX, becoming a key stablecoin for mostly BTC and ETH pairs. The other source of app activity comes from Polymarket, where USDC supports an active prediction market as the main source of liquidity.

The token is also showing expansion of its on-chain activity, mostly on the Ethereum chain. The stablecoin is the fourth most active smart contract on Ethereum in early July, burning up 65 ETH in daily fees. The stablecoin is slowly catching up to Tether, with 100 ETH in daily burned fees. 

USDC is also expanding on Solana, minting another 250M tokens in the past 24 hours. The supply on Solana peaked above 12B tokens, then shrank again at around 10.5B. Solana activity is expected to pick up ahead of its new ETF launch, boosting demand for stablecoin liquidity.

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