Despite USDT having a market capitalization that is $100 billion higher than USDC, USDC’s annualized turnover rate is ten times that of USDT.
By: Tanay Ved, Coin Metrics
Compiled by: Luffy, Foresight News
Stablecoins have evolved from trading tools into a cornerstone of on-chain liquidity, providing around-the-clock, global value storage as well as channels for transfers and settlement. Since 2025, the scale of stablecoin on-chain settlements has become decoupled from spot trading volumes in crypto. This year, the adjusted on-chain transfer volume for stablecoins at one point surpassed $250 billion per day, while exchange trading volumes have fallen to about $18 billion per day.
From 2026 to date, stablecoins have cumulatively achieved a total adjusted-transfer value of $417 trillion. Although the total stablecoin issuance has recently dipped, the on-chain turnover frequency of unit funds has continued to rise compared with previous years. Use cases are also expanding, covering exchange liquidity management, DeFi collateral allocation and scheduling, as well as emerging individual payments and cross-border corporate fund transfers.
This article pierces through the apparent “trillion-dollar” stablecoin transfer facade and analyzes the turnover rates of USDC and USDT, as well as the drivers behind large volumes on major public chains. The research is built on prior work (the Base chain USDC anomaly). Earlier findings showed that about 50% of USDC transfers on Base’s L2 network come from DeFi infrastructure (DEX market-making and flash loans). We then, from a bottom-up approach, analyzed the transfer composition of USDC and USDT across three chains: Ethereum, Base, and Tron.
Issuance volume and turnover rate
Issuance volume represents the size of the monetary base of stablecoins, while turnover rate measures how frequently the existing funds circulate and change hands on-chain. Taken together, these two indicators show whether stablecoins are in frequent circulation or simply idle as a store-of-value tool. This distinction is also at the core of the (CLARITY Act). The act encourages incentives generated from real transaction activity and does not encourage simply holding tokens to earn收益.
From this perspective, USDC’s advantage is clear. Data from 2026 shows that USDC’s annualized (adjusted supply) turnover rate is 741x—ten times that of USDT (74x)—even though USDT’s market value is more than $100 billion higher. This means that, relative to total circulating supply, USDC changes hands on-chain far more frequently than USDT.
Stablecoin issuance volume and turnover rate; data source: Talos Network Data Pro
With the enactment of the 2025 (GENIUS Act), regulatory benefits have accrued to USDC, continuously strengthening its network effects in the U.S. compliant market, DeFi, and institutional settlement. In contrast, USDT’s advantages stem from its first-mover edge, demand from overseas emerging markets, and deep binding to the Tron chain—regions where demand for USD-denominated assets and cross-border remittances is strong.
USDC issued by Circle already surpassed USDT in cumulative adjusted-transfer volume back in 2024, and the lead has continued to widen this year. As of August 2026, USDC’s cumulative settlement transfer volume is $3.2 trillion, holding a 77% share of the stablecoin market; USDT’s transfer volume is $0.8 trillion, representing 19%. Although USDC still leads, the gap between the two is narrowing: USDC’s daily transfer volume has fallen to below $100 billion.
Adjusted transfer volume of USDC and USDT; data source: Talos Network Data Pro
According to Circle’s Q2 2026 earnings report, USDC’s on-chain transaction volume in Q2 grew 151% year over year to reach $1.48 trillion, but the growth rate of circulating supply is far lower than that of transaction volume. Currently, about 95% of Circle’s revenue still comes from interest on reserves rather than transaction fees. Circle’s self-developed one-layer public chain Arc is a key part of its strategy to source transaction-fee revenue. Therefore, clarifying the underlying drivers of USDC transaction volume is of significant importance.
Below, we break down the trading composition of USDC on Ethereum and Base networks, and USDT on Ethereum and the Tron chain. These chains carry the vast majority of stablecoin transfer activity.
Transfer composition of USDC and USDT
To determine what drives the formation of massive transaction volumes, we continue the research framework for USDC on the Base chain and apply a bottom-up analysis approach. For each public chain and each stablecoin, we label the key contracts that frequently generate mechanical transfers: top flash-loan lending-market protocols, major large-liquidity pools of leading DEXs on each chain, and known exchange wallet addresses. All transactions are categorized into three groups: flash loans, DEX liquidity provision, and centralized exchange fund flows.
The study is based on Talos’ original transfer data. It estimates each type of transaction’s share of total transfers on public chains. The labeled categories are only a lower-bound approximation; the remaining portion includes unrecognized behavior: payments, cross-chain bridge transfers, treasury fund allocation, and other types of settlement activities.
USDC on the Base chain
Base, the L2 network launched by Coinbase, is the most important venue for USDC transfers in 2026. Transactions are highly concentrated: more than 90% of USDC transfers on the Base chain are completed through just three contracts. Looking across the year, Aerodrome’s decentralized exchange liquidity market-making contributes the largest trading volume; in the second half of the year, flash-loan arbitrage activities relying on the Morpho protocol rose rapidly. In June, single-day flash-loan transfer volume once exceeded $500 billion. With low fees and abundant USDC liquidity, Base is well-suited for running large-scale, high-frequency automated strategies.
Flash loans, 23%: robots complete unsecured borrowing and repayment within a single transaction, using Morpho to execute cross-market arbitrage via unified contract execution
DEX liquidity provision, 69%: automated strategies continuously adjust liquidity in Aerodrome’s two major liquidity pools as prices fluctuate, creating huge on-paper trading volumes, but net capital and position sizes change very little
Others, about 8%: activities outside the labeled flash-loan and liquidity-pool contracts
USDC monthly trading volume on the Base chain; data source: Talos CM ATLAS
USDC on Ethereum
USDC on the Ethereum chain is even more concentrated in flash loans: 65% of total transfer volume, nearly three times the share on the Base chain. Ethereum USDC has deep liquidity and a mature lending ecosystem, making it suitable for large-scale flash-loan arbitrage. However, high gas fees make it hard to support Base’s kind of continuous liquidity rebalancing/routing behavior.
Flash loans: 65%
DEX liquidity provision: 0.3%
Fund flows between centralized exchanges: 2%
Other unclassified activities: about 33%
USDC monthly trading volume on Ethereum; data source: Talos CM ATLAS
USDT on Ethereum
Flash loans also account for an important share of Ethereum USDT trading volume, but the proportion is lower than that of USDC on the same chain. Fund flows between centralized exchanges make up a higher share, aligning with USDT’s long-term positioning of serving exchange settlement and liquidity management. The statistical scope includes known CEX deposit/withdrawal wallets such as Binance and OKX, covering users’ deposits/withdrawals as well as internal transfers between exchange hot and cold wallets.
Flash loans, 46%
DEX liquidity provision, 0.3%: mainly Uniswap V3 USDT/WETH trading pools
Fund flows between centralized exchanges, 9%: covers deposit/withdrawal flows of more than 30 centralized exchange wallets
Other unclassified activities, about 45%
Ethereum USDT monthly trading volume; data source: Talos CM ATLAS
USDT on Tron
The Tron's USDT usage pattern is fundamentally different. Flash loans and DEX market-making activities that drive massive volumes on Base and Ethereum are almost negligible. Among identified traffic, the highest share comes from fund flows between centralized exchanges, reflecting Tron’s role as a low-cost conduit that handles large volumes of exchange deposits and withdrawals. Unclassified traffic accounts for as much as 80%, the highest of all the tracked chains. Most likely, it includes cross-border remittances and various payment scenarios.
Flash loans: almost none—lending protocols such as JustLend did not generate any significant related transaction volume
DEX liquidity provision, 0.2%: distributed across 4 Sunswap trading pools
Fund flows between centralized exchanges, 19%: covers deposit/withdrawal for 33 overseas exchange wallets including Binance, OKX, and Bybit
Other unclassified activities, about 80%
Tron USDT monthly trading volume; data source: Talos CM ATLAS
The results clearly show structural differences in stablecoin ecosystems across different public chains. On Base and Ethereum, USDC trading volume is mainly driven by flash loans and liquidity rebalancing/routing adjustments; Ethereum USDT balances both flash loans and exchange fund flows; Tron USDT has almost no large-scale DeFi transactions, while also having the largest unlabelled transaction volume.
Data source: Talos CM ATLAS, Talos Network Data Pro
Conclusion
The on-chain transfer scale of stablecoins has reached a considerable magnitude and is often benchmarked against global mainstream payment networks. But today, most of that volume is, in essence, internal liquidity scheduling within the crypto market: liquidity deployment and rebalancing, arbitrage execution, and cross-platform fund settlement. These applications are real and effective, improving liquidity, trading efficiency, and global accessibility of crypto assets.
Meanwhile, it’s not enough to equate the appearance of huge transfer volumes with individual payments or real-economy activity. At this stage, stablecoins function more as the settlement layer underlying the crypto asset market. Payments, cross-border remittances, and enterprise B2B scenarios are still being actively developed. Looking ahead, the importance of transaction quality for stablecoins will be no less than the transaction scale. Differences in issuance volume and turnover rates can directly reflect how stablecoin funds move and are allocated within the crypto market.