USDT issuance grew on Ethereum without a sustained rise in contract holdings, BIS finds
In brief
- BIS paper: more USDT issued without a sustained rise in Ethereum smart-contract balances.
- Ethereum's contract-held USDT share fell from 15%-20% to roughly 10%-15% after late 2024.
- Tron smart-contract accounts held about 1% of USDT through most of the series.
- Holder data stop before 2026; DefiLlama later showed $183.7 billion USDT across chains.
What the BIS data show
On Ethereum, smart-contract accounts held more than 20% of the network's USDT during part of 2021 and 2022. That share hovered around 15% to 20% until late 2024, then moved down to roughly 10% to 15% as issuance expanded.
It's a proportion story, though.
CryptoSlate stressed that the drop is a change in the share of tokens sitting in contracts, not a finding that the absolute balance kept falling. The BIS authors said issuance growth didn't bring a sustained increase in contract holdings, and the Ethereum series showed far more USDT in non-contract accounts as supply grew. Figure 10 of the study places Ethereum contract-held USDT at roughly $10 billion to $15 billion toward the end of its plotted period (Tron's sits around $1 billion or less), though those are approximate chart values.
How the researchers built it
The researchers reconstructed USDT holdings from Ethereum and Tron transfer event logs, identified smart-contract accounts from contract deployments, and cross-checked supply against mint, burn and blacklist-destruction events.
There are limits. The holder-balance chart stops before 2026, so its percentages can't be read as September 2026 measurements. The two chains' percentages also use different chain-specific denominators, which means they can't be treated as a single measure of defi adoption.
"A smart contract may hold USDT for a bridge, wrapper or custodian rather than a DeFi lending or trading strategy." (CryptoSlate)
That's why contract balances aren't a direct gauge of defi activity. CryptoSlate also noted that Ethereum's falling share doesn't prove defi use contracted.
Where supply stands now
When CryptoSlate checked on Sept. 28, it cited DefiLlama data showing about $183.7 billion in USDT market cap across chains, including about $73.3 billion on Ethereum and about $92.5 billion on Tron. Those figures are a later, third-party supply snapshot, not an update of the BIS holder breakdown.
This report is based on CryptoSlate's account of the BIS working paper and the DefiLlama figures it cited.
Frequently asked questions
Does the BIS paper show that DeFi demand for USDT fell?
No. The BIS authors said USDT issuance growth didn't bring a sustained increase in smart-contract holdings on Ethereum. The DeFi reading comes from CryptoSlate, which said the findings challenge the idea that more supply means more DeFi capital, and also said Ethereum's falling share doesn't prove DeFi use contracted. Contract balances aren't a direct DeFi measure, because a contract may hold USDT for a bridge, wrapper or custodian.
Why can't the Ethereum and Tron percentages be compared directly?
The two percentages use different chain-specific denominators, so they can't be treated as a single measure of DeFi adoption. On Ethereum, contracts held roughly 10% to 15% of USDT after late 2024. On Tron, they held about 1% through most of the series.
Are the BIS figures current as of September 2026?
No. The paper's holder-balance chart stops before 2026, so its percentages can't be read as September 2026 measurements. CryptoSlate separately cited DefiLlama data from Sept. 28 showing about $183.7 billion in USDT across chains, but that's a later third-party supply snapshot, not an update of the BIS breakdown.
