Tether’s USDT briefly moved ahead of Ether on a fully diluted valuation basis after ETH dropped to its lowest level of 2026. Market data showed USDT near $191.5 billion in FDV, compared with roughly $189.3 billion for ETH. Ethereum later kept its number-two position by market capitalization, while Tether remained third by circulating market value, but the short-lived flip showed how narrow the gap has become during the latest sell-off.
The shift came during another weak session for the broader crypto market. Over the past 24 hours, ETH fell more than 5% and traded close to support zones last seen in October 2023 and April 2025. USDT stayed near $1, which is expected for a dollar-pegged stablecoin. In a falling market, that contrast stands out quickly.
Stablecoin supply keeps climbing
The move reflects more than a decline in Ether. Stablecoin demand has continued to expand even as major crypto assets have lost ground. In a recent mid-year market update, 21Shares said that stablecoins contracted by more than 30% in the last bear market, while this cycle they are reaching fresh all-time highs. That contrast suggests capital is not fully leaving crypto rails. A large share of it is shifting into dollar tokens and waiting there.
That matters because stablecoins function as trading collateral, payment rails, and a source of dollar liquidity inside the crypto economy. If supply keeps growing during a downturn, users are still active on-chain and inside exchange-based markets, even if they are reducing directional risk. Defensive positioning can still mean strong demand.
Tether is also broadening where USDT is used. The report noted that Tether-backed Oobit has brought USDT payments to Brazil’s Pix network, giving users another route to hold dollar tokens and spend through local payment infrastructure. That does not directly change Ether’s valuation, but it does add to the practical role of stablecoins beyond trading desks.
Ethereum faces pressure from the market and from inside the ecosystem
Ether’s weak price action is unfolding as the Ethereum ecosystem goes through several changes at once. Investors are watching ETF flows, corporate treasury activity, and debates over network funding, while the token itself remains close to long-term support. Price has been soft, and the broader backdrop has not helped.
The Ethereum Foundation has also gone through a wider restructuring that cut about 20% of its workforce, removing 54 roles. That has raised fresh questions about Ethereum’s development structure during a period of weak ETH performance. At the same time, a new research group, Ethlabs, has entered the picture. The nonprofit is backed by Joe Lubin, BitMine, and SharpLink, and includes former Ethereum Foundation researchers working on settlement speed, network capacity, native asset issuance, and cross-chain standards.
Treasury buyers are still adding ETH on weakness
Even with the market under pressure, some corporate treasury players are still buying Ether on dips. SharpLink purchased 5,000 ETH after an eight-month pause while Ether was trading near yearly lows. The company now holds 876,285 ETH, including staking rewards.
BitMine’s position is much larger. According to the report, Tom Lee’s BitMine has staked 86% of its ETH holdings, pushing staked Ether to about 4.88 million tokens. That gives the firm one of the biggest public ETH treasury positions in the market. Those purchases show that some institutional holders still treat ETH as a long-term treasury asset. At the same time, the brief FDV flip in favor of USDT points to a different market preference right now: traders are choosing stable dollar liquidity while Ether tries to hold key support.