Coinmetrics says the surge in on-chain stablecoin transfers should not be read as a direct measure of real-world payments. In a report examining USDC and USDT across Ethereum, Base, and Tron, the firm found that in some networks more than 90% of volume was tied to mechanical activity such as flash loans, DEX liquidity rebalancing, and exchange-related fund movements.
The report describes stablecoins as a core layer of on-chain liquidity rather than a tool used only for trading. Since 2025, on-chain stablecoin settlement has decoupled from crypto trading volume, it said. Adjusted on-chain transfer volume topped $250 billion a day at one point this year, while exchange trading volume fell to about $18 billion a day.
So far in 2026, adjusted stablecoin settlement volume has reached $41.7 trillion. Coinmetrics said supply growth has slowed recently, but each dollar of stablecoin supply is changing hands more often than in prior years. In its view, usage now spans exchange liquidity management, DeFi collateral movements, and emerging consumer and business-to-business payments.
USDC shows much higher velocity than USDT
Coinmetrics compared stablecoins through two lenses: supply and velocity. Supply measures the size of the monetary base, while velocity shows how often those tokens move on-chain. The report said that distinction sits at the center of the CLARITY Act, which allows incentives for genuine transaction activity while discouraging interest earned simply by holding balances.
By that measure, USDC stands out. Its annualized adjusted supply velocity was 741x, versus 74x for USDT, a tenfold gap, even though USDT’s market capitalization remains more than $100 billion larger. Coinmetrics said that points to far more frequent transfer activity in USDC relative to its circulating supply.
The report also said passage of the GENIUS Act in 2025 gave USDC a regulatory tailwind, reinforcing its network effects in regulated U.S. markets, decentralized finance, and institutional settlement. USDT’s position, by comparison, was tied to first-mover advantage, use in offshore emerging markets, and its close association with Tron.
Circle’s USDC overtook Tether’s USDT in adjusted transfer volume in 2024, and the lead widened this year. As of August 2026, USDC had settled $32 trillion in transfers, or 77% of the stablecoin market, while USDT had settled $8 trillion, or 19%. Even so, Coinmetrics said the gap had narrowed somewhat, with USDC’s daily transfer volume falling back below $100 billion.
According to Circle’s second-quarter 2026 earnings, USDC on-chain transaction volume rose 151% year over year to $14.8 trillion in Q2 2026, while circulating supply grew much more slowly. Reserve income still accounted for about 95% of revenue. The report said Circle’s Layer-1 blockchain Arc is one route for the company to capture transaction-related revenue, which makes the drivers of USDC volume an important question.
How Coinmetrics broke down stablecoin transfers
To identify the sources of these large volumes, Coinmetrics used a bottom-up method based on its earlier work on USDC on Base. For each stablecoin and each chain, it identified contracts most likely to generate mechanical volume: major lending markets used for flash loans, the largest liquidity pools on the dominant DEXs for each chain, and known exchange wallets. Those were grouped into three categories: flash loans, DEX liquidity, and centralized exchange fund flows.
It then used Talos unadjusted transfer volume data to measure how much of raw gross transfer volume on each chain passed through those categories. Coinmetrics said the tagged buckets should be treated as lower-bound estimates. The remainder may include payments, bridge activity, treasury movements, and other forms of settlement that were not isolated separately.
USDC on Base: volume is highly concentrated
Base, Coinbase’s Layer 2 network, accounted for 67% of total USDC transfer volume in 2026, according to the report. Activity was highly concentrated: more than 90% of Base USDC volume traced back to just three contracts. Across the period studied, DEX liquidity on Aerodrome made up the largest share, while flash-loan activity through Morpho became more prominent in the second half of 2026. On one day in June, flash-loan volume exceeded $500 billion.
- Flash loans: 23%. Bots borrowed and repaid uncollateralized loans in a single transaction through Morpho’s singleton contract to capture arbitrage opportunities.
- DEX liquidity: 69%. Automated strategies continuously rebalanced liquidity across two Aerodrome pools as prices moved, generating large gross volume with little change in net capital.
- Remainder: about 8%, covering activity outside the tagged flash-loan and liquidity-pool contracts.
Coinmetrics said Base’s low fees and deep USDC liquidity made high-frequency, automated activity economical at scale.
USDC on Ethereum: flash loans dominate even more
On Ethereum, USDC activity was even more heavily concentrated in flash loans. They accounted for 65% of transfer volume, nearly three times the share seen on Base. Coinmetrics said Ethereum’s deep USDC liquidity and large lending markets make it a natural venue for large-scale flash loans and arbitrage, while higher fees limit the sort of constant rebalancing seen on lower-cost chains such as Base.
- Flash loans: 65%
- DEX liquidity: 0.3%
- Centralized exchange fund flows: 2%
- Remainder: about 33%
USDT on Ethereum: a mix of flash loans and exchange flows
USDT on Ethereum also showed a meaningful flash-loan share, though less than USDC. Centralized exchange fund flows were more prominent here, matching USDT’s broader role in exchange-linked liquidity and settlement.
- Flash loans: 46%
- DEX liquidity: 0.3%, mainly through the USDT/WETH pool on Uniswap V3
- Centralized exchange fund flows: 9%, covering deposits and withdrawals across 30 exchange wallets
- Remainder: about 45%
USDT on Tron: little identified DeFi activity
On Tron, USDT followed a different and more stable usage pattern. Unlike USDC and Ethereum-based USDT, flash-loan and DEX-liquidity activity was almost absent. The largest identified bucket was centralized exchange fund flows, reflecting Tron’s role as a low-cost rail for exchange deposits, withdrawals, and settlement.
- Flash loans: negligible. Coinmetrics said lending protocols such as JustLend did not generate meaningful volume.
- DEX liquidity: 0.2%, across four Sunswap pools
- Centralized exchange fund flows: 19%, covering deposits and withdrawals across 33 confirmed exchange wallets, including Binance, OKX, and Bybit, among other major offshore exchanges
- Remainder: about 80%
The breakdown highlights very different market structures across blockchains. USDC volume on Base and Ethereum was largely tied to flash loans and liquidity activity. USDT on Ethereum showed a more mixed profile, split between flash loans and exchange flows. USDT on Tron had almost no identified DeFi activity, with the largest share left in the unclassified remainder.
Big transfer numbers are not the same as payment adoption
Coinmetrics said stablecoin transfer volume has reached a scale often compared with major payment networks, but much of that flow reflects the movement of liquidity inside crypto markets: deploying and rebalancing liquidity, running arbitrage, and settling capital between exchanges and protocols.
Those are real and useful functions, the report said, because they make digital asset markets more liquid, more efficient, and globally accessible. Even so, total transfer volume should not be treated as the equivalent of consumer payments or real-economy commerce. Stablecoins are increasingly functioning as a settlement layer for digital asset markets, while payment, remittance, and B2B use cases are still developing. For Coinmetrics, the quality of transfer volume matters as much as the scale, because differences in supply and velocity show how stablecoin liquidity is actually being deployed.