Tether's USDT drops $4.6B at 19 exchanges as USDC and RLUSD gain, Crystal data shows
In brief
- USDT balances at 19 selected exchanges and lenders fell $4.6 billion in Q3, per Crystal Intelligence.
- Total USDT supply fell only $647 million, or 0.4%, to about $184 billion.
- RLUSD supply rose 59% market-wide to $2.5 billion; USDC supply grew $687 million.
- Circle spent $819 million, 59% of first-half 2026 revenue, on distribution and transaction costs.
The cohort vs. the market
So did Tether lose $4.6 billion? Not overall. Across the wider market, USDT's circulating supply fell $647 million, or 0.4%, to about $184 billion during the quarter. Market-wide, RLUSD's supply rose 59% to $2.5 billion and USDC's grew $687 million (separate from the cohort's $569 million of USDC and $493 million of RLUSD).
The cohort losses were concentrated at big venues. Crystal's data shows Bybit recorded the largest reduction, shedding $1.66 billion in USDT while adding $315 million of RLUSD. Binance cut its Tether holdings by $987 million and picked up $223 million of USDC, while OKX trimmed $899 million in USDT and added $273 million of USDC.
Incentives at the exchange level
CryptoSlate's read is that this is a fight for trading balances, with issuers and their distribution partners offering financial incentives to exchanges and token holders. The programs are specific. Bybit's RLUSD holdings climbed after a rewards campaign it launched with Ripple in July, and Bitget and MEXC accumulated USDGO through holding incentives and conversion promotions.
Hyperliquid recorded a $1.5 billion increase in USDC deposits, bringing holdings to roughly $7.2 billion. That growth coincided with a Coinbase and Circle arrangement letting Hyperliquid receive income from USDC deployed on the platform (Coinbase acts as treasury deployer, Circle runs the infrastructure, and Coinbase shares most reserve-linked income). Crystal found about three-quarters of the increase came from one cluster of linked wallets, though.
Coinbase-owned Deribit added $365 million in USDC and expanded its rewards program to about 70 more countries in August.
What distribution costs Circle
None of it's cheap.
Circle's first-half results, as cited by CryptoSlate, show about $1.4 billion in revenue with $819 million (59%) spent on distribution and transaction costs. Another $473 million went to operating expenses and network investment, leaving roughly $103 million in net profit, or seven cents of every revenue dollar.
Coinbase, Circle's largest distribution partner, held a record $20 billion in average USDC across its products in the second quarter, up 44% year over year. Circle also signed a five-year agreement with Binance, which invested $100 million in the company. CryptoSlate noted these commercial deals are getting more expensive for issuers trying to reach exchanges, lending platforms and their customers.
Frequently asked questions
Did Tether's total USDT supply fall by $4.6 billion in the third quarter?
No. The $4.6 billion drop covers only 19 selected exchanges and lenders tracked by Crystal Intelligence. Across the wider market, USDT's circulating supply fell $647 million, or 0.4%, to about $184 billion during the quarter.
Why are exchanges holding more USDC and RLUSD?
CryptoSlate attributed the shift to competition for trading balances, with issuers and partners offering incentives. Examples include Bybit's July RLUSD rewards campaign with Ripple, Deribit's USDC rewards program, and a Coinbase and Circle arrangement sharing USDC income with Hyperliquid.
How much does Circle spend on distribution?
Circle generated about $1.4 billion in revenue in the first half of 2026 and spent $819 million, or 59%, on distribution and transaction costs. After $473 million in operating expenses and network investment, net profit was about $103 million.
