- Tether’s USDT market cap is shrinking faster in dollar terms than after the FTX collapse.
- USDC and the wider stablecoin market are contracting at the same time.
- Bitcoin spot demand indicators have weakened alongside the liquidity drain.
- Tether’s latest reserve report still shows assets above liabilities.
Tether’s USDT market cap has fallen by $6.6 billion over the past 60 days, on-chain analytics firm CryptoQuant reported on November 10, more than twice the dollar contraction recorded in December 2022, the month after FTX collapsed. USDT is the main dollar instrument traders use to buy Bitcoin on exchanges, so the shrinking supply leaves less ready cash in a market where Bitcoin already trades about 15% below its September high near $87,400.
USDC Lost 3.76% in the Same Month
A drop in one stablecoin can simply mean traders are switching issuers, so the rest of the sector carries more weight than the USDT figure alone. DefiLlama’s stablecoin dashboard put total stablecoin capitalization at $289.81 billion on November 10, down 4.57% in 30 days. Circle’s USDC fell almost as fast as USDT, which left Tether’s market share nearly unchanged at 60.81%. Ripple’s RLUSD and Ethena’s USDe, a synthetic dollar backed by crypto and offsetting derivatives positions, both grew from bases too small to change the total.
Source: DefiLlama, November 10.
A 3.6% Drop Against 5% After FTX
CryptoQuant’s comparison counts dollars, and USDT is far larger than it was in late 2022. A contraction of $3.2 billion back then removed close to 5% of a supply near $66 billion, while today’s $6.6 billion equals about 3.6% of the $182.8 billion circulating in mid-September. The 2022 outflow came from customers who doubted exchanges were solvent, and nothing of that kind has surfaced this autumn. The current drain looks like a slow withdrawal of capital that has run since USDT supply peaked near $190 billion in May, which makes it less dramatic and possibly harder to reverse.
Source: CryptoQuant, DefiLlama.
Where Redeemed USDT Goes
New USDT appears when large clients such as exchanges and market makers wire dollars to Tether and receive tokens. The reverse happens when they send tokens back for dollars, and Tether pulls that USDT from circulation and can destroy it. CryptoQuant has tied stablecoin growth earlier in this cycle directly to the funding behind those rallies, and that funding is now flowing out at the fastest 60-day pace in CryptoQuant’s records.
A $6.6 billion contraction does not mean that amount left Bitcoin. Part of it reflects September profits moving back to bank accounts, and a restrictive Federal Reserve keeps Treasury bills paying enough to make idle stablecoins costly to hold. The recent Binance security incident added uncertainty, though no data links it directly to the outflows.
284,000 BTC of Demand Gone in a Month
CryptoQuant’s apparent demand metric compares newly mined coins with changes in the stock of Bitcoin left unmoved for a year or more. It fell by 284,000 BTC over 30 days, the steepest drop since March 2025, meaning older coins are returning to circulation far faster than buyers are putting coins away. The Coinbase Premium Index, the gap between Bitcoin’s price on Coinbase and on offshore exchanges, has stayed negative for 30 straight days, a sign that US buyers are less willing to pay up. US spot Bitcoin ETFs recorded roughly $1.28 billion in net outflows in the first week of November, according to Farside Investors data.
The firm’s Bull Score Index, a 0 to 100 composite of market indicators, fell from 90 on October 13 to 20. It hit the same level in April 2025 and recovered to 80 within two months, so readings this low have come before rebounds as well as deeper falls. Investors who bought in the past one to three months hold an average paper loss of about 6%, while earlier bull-market corrections pushed that group to roughly 12% before selling eased.
$7.95B Still Sits Above Tether’s Tokens
None of this points to a problem with Tether’s backing. Its quarterly attestation, published October 30, showed $191.5 billion in reserves against $183.5 billion in liabilities on September 30, an excess of $7.95 billion, with $132.4 billion in direct and indirect US Treasury exposure. Redemptions shrink assets and liabilities equally, so the cushion holds as long as Tether can sell reserves near book value, although the report predates the November outflows.
Four Readings That Must Turn First
Thinner stablecoin balances mean shallower order books, where trades of the same size move prices further and rallies lean more on borrowed money in derivatives than on spot cash. CryptoQuant has said conditions improve only once the 60-day USDT change stabilizes and supply returns to growth. A steady USDC supply, a positive Coinbase Premium and consecutive weeks of ETF inflows would show US buyers returning alongside that cash.
Tether’s attestation for the quarter ending December 31, due around the end of January on its recent schedule, will be the first official record of how far its Treasury holdings fell with circulating supply and whether the $7.95 billion excess survived the redemptions.
