Matrixport: Recent $100B Drop in Tether Trading Volume Not a Bearish Signal

Crypto market sees predictable end-of-year slowdown as USDT circulation declines

  • Tether USDt market cap decreased 2.8% from its December peak of $141 billion.
  • Daily trading volumes dropped 64% from $154 billion to $55 billion between December and January.
  • Matrixport analysis suggests market sentiment remains positive despite volume decline.
  • USDT maintains its position as the largest stablecoin by market capitalization.
  • Current market indicators do not support a bearish outlook according to experts.

Tether Volume Decline Sparks Market Analysis

Tether’s USDT stablecoin experienced a substantial decrease in trading volume and market capitalization, yet financial experts maintain a cautiously optimistic market outlook. The leading stablecoin’s daily trading activity dropped from $154 billion to $55 billion between mid-December 2024 and January 2025.

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Market Cap Fluctuations

Data from CoinGecko shows USDT’s market capitalization declined 2.8% from its December 19 peak of $141 billion. This reduction represents approximately $4 billion in value, marking a notable shift in the stablecoin’s market presence.

Expert Analysis and Market Implications

Matrixport, a cryptocurrency financial services platform, suggests the recent decline may not indicate broader market weakness. Stablecoins, which maintain a 1:1 peg with fiat currencies like the US dollar, often experience fluctuations in trading volumes based on market activity and investor behavior.

The current market dynamics reflect typical end-of-year trading patterns, with reduced activity during holiday periods. Historical data shows similar volume decreases during previous year-end periods, though the magnitude of this decline stands out compared to prior years.

USDT remains the dominant stablecoin in the cryptocurrency ecosystem, maintaining its position despite the recent volume reduction. The stablecoin’s role as a primary trading pair for most cryptocurrencies continues to underscore its significance in market liquidity and trading operations.

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