Author|Tanay Ved, Coin Metrics

Translator|Luffy, Foresight News

Stablecoins have evolved from trading tools to a cornerstone of on-chain liquidity, providing 24/7, global value storage, transfer, and settlement channels. Since 2025, the on-chain settlement scale of stablecoins has decoupled from the cryptocurrency spot trading volume. This year, the adjusted on-chain transfer volume of stablecoins once exceeded $250 billion daily, while exchange trading volume has fallen to about $18 billion daily.

From 2026 to present, stablecoins have cumulatively achieved an adjusted total transfer amount of $41.7 trillion. Although the total issuance of stablecoins has recently declined, the turnover frequency of unit funds on-chain continues to rise compared to previous years. The application scenarios are also continuously expanding, covering exchange liquidity management, DeFi collateral scheduling, and emerging personal payments, and corporate cross-border fund flows.

This article penetrates the trillion-level stablecoin transfer surface to analyze the turnover rates of USDC and USDT, breaking down the driving factors behind the massive transaction volumes on major public chains. The research builds on the previous article "The Unique Phenomenon of USDC on the Base Chain," which found that about 50% of USDC transfers on the Base Layer 2 network come from DeFi infrastructure (DEX market-making, flash loans). We conducted a bottom-up analysis of the transfer composition of USDC and USDT on Ethereum, Base, and Tron chains.

Issuance and Turnover Rate

Issuance represents the monetary base scale of stablecoins, while turnover rate measures the frequency of existing funds being transferred on-chain. Combining these two indicators can determine whether stablecoins are in a state of frequent circulation or merely held as value storage tools. This distinction is also at the core of the "CLARITY Act," which encourages incentives based on real trading activities and does not promote merely holding tokens to earn yields.

From this perspective, USDC has significant advantages. Data from 2026 indicates that the annualized (adjusted supply) turnover rate of USDC is 741 times, ten times that of USDT (74 times), even though USDT's market capitalization exceeds $100 billion. This means that in relation to the total circulation, USDC's on-chain turnover frequency is much higher than that of USDT.

Issuance and Turnover Rate of Stablecoins

The implementation of the "GENIUS Act" in 2025 brought regulatory benefits to USDC, continually solidifying its network effects in the compliant U.S. market, DeFi, and institutional settlement fields. In contrast, USDT's advantages stem from first-mover advantage, demand in emerging overseas markets, and deep binding to the Tron chain, where there is a strong demand for dollar assets and cross-border remittances.

USDC, issued by Circle, first surpassed USDT in adjusted transfer volume as early as 2024, and the lead has continued to expand this year. As of August 2026, USDC's cumulative settlement transfer scale reached $32 trillion, occupying 77% of the stablecoin market share; USDT's transfer scale was $8 trillion, accounting for 19%. Although USDC still leads, the gap between the two is narrowing, with USDC's daily transfer volume dropping below $100 billion.

Adjusted Transfer Volume of USDC and USDT

According to Circle's Q2 2026 financial report, USDC's on-chain trading scale in Q2 grew by 151% year-on-year, reaching $14.8 trillion, but the growth rate of circulating supply was far lower than that of trading. Currently, about 95% of Circle's revenue still comes from reserve interest, not trading fees. Circle's self-developed Layer 1 chain, Arc, is an important layout to create income from trading fees. Therefore, clarifying the fundamental driving factors behind USDC's trading volume is of significant importance.

The following will break down the transaction composition of USDC on Ethereum and Base networks, as well as USDT transactions on Ethereum and Tron chains, as these chains carry the vast majority of stablecoin transfer activities.

Composition of USDC and USDT Transfers

To ascertain the reasons for the massive trading volume, we continue the research framework of Base chain USDC, utilizing a bottom-up analysis approach. For each public chain and each type of stablecoin, we marked key contracts that generate high-frequency mechanical transfers: leading protocols in the flash loan lending market, large liquidity pools of mainstream DEX on each chain, and known exchange wallet addresses. All transactions are classified into three categories: flash loans, DEX liquidity provision, and centralized exchange capital flows.

The study is based on original transfer data from Talos, estimating the proportion of various transactions in the total transfer scale of the public chain. The marking classification serves only as a lower bound estimate, with the remainder including unidentified activities: payments, cross-chain bridge transfers, treasury fund scheduling, and other various settlement activities.

USDC on Base Chain

The Layer 2 network Base launched by Coinbase is the primary battlefield for USDC transfers in 2026. Transactions are highly concentrated, with over 90% of USDC transfers on Base completed through just three contracts. Throughout the year, Aerodrome decentralized exchange has contributed the largest transaction volume in liquidity market-making; in the second half of the year, flash loan arbitrage activities relying on the Morpho protocol rapidly emerged. In June, the daily volume of flash loan transfers once exceeded $500 billion. Base's low fees and ample USDC liquidity are suitable for large-scale high-frequency automated strategy operations.

·Flash Loans, 23%: Bots complete uncollateralized borrowing and repayment in a single transaction, leveraging Morpho's unified contract to execute cross-market arbitrage;

·DEX Liquidity Provision, 69%: Automated strategies continuously adjust the liquidity of Aerodrome's two major funds pools with price fluctuations, creating massive on-paper transaction volume, but with almost no change in net funds and positions;

·Others, approximately 8%: activities outside the marked flash loan and liquidity pool contracts.

Monthly Transaction Volume of USDC on Base Chain

USDC on Ethereum

The USDC transactions on the Ethereum chain are more concentrated in flash loans, accounting for 65% of the total volume, nearly three times the proportion on the Base chain. Ethereum's USDC liquidity is deep, and the lending ecosystem is well-developed, making it suitable for large-scale flash loan arbitrage; however, gas fees are higher, making it difficult to support the kind of continuous liquidity rebalancing seen on Base.

·Flash Loans: 65%;

·DEX Liquidity Provision: 0.3%;

·Centralized Exchange Capital Flows: 2%;

·Other Unclassified Activities: approximately 33%.

Monthly Transaction Volume of USDC on Ethereum

USDT on Ethereum

Flash loans also occupy an important share of the USDT transaction volume on Ethereum, but the proportion is lower than that of USDC on the same chain. Centralized exchange capital flows account for a higher proportion, aligning with USDT's long-term positioning in serving exchange settlements and liquidity allocation. The statistical scope includes known deposit and withdrawal wallets from centralized exchanges like Binance and OKX, covering user deposits and withdrawals, as well as internal transfers of exchange hot and cold wallets.

·Flash Loans, 46%;

·DEX Liquidity Provision, 0.3%: primarily from Uniswap V3 USDT/WETH trading pool;

·Centralized Exchange Capital Flows, 9%: covering deposit and withdrawal flow from over 30 centralized exchange wallets;

·Other Unclassified Activities, approximately 45%.

Monthly Transaction Volume of USDT on Ethereum

USDT on Tron

The USDT usage pattern on the Tron chain is markedly different. The flash loans and DEX market-making activities that drive substantial transaction volumes on Base and Ethereum are almost negligible. Among identified flows, centralized exchange capital flows have the highest proportion, reflecting Tron as a low-cost channel accommodating a large number of exchange deposit and withdrawal businesses. The proportion of unclassified flows is as high as 80%, the highest among all statistical chains, likely including cross-border remittances and various payment scenarios.

·Flash Loans, nearly no scale: Lending protocols like JustLend did not generate significant related transaction volume;

·DEX Liquidity Provision, 0.2%: distributed across four Sunswap trading pools;

·Centralized Exchange Capital Flows, 19%: covering deposit and withdrawal flows from 33 overseas exchanges such as Binance, OKX, and Bybit;

·Other Unclassified Activities, approximately 80%.

Monthly Transaction Volume of USDT on Tron

The analysis results clearly reveal the structural differences in the stablecoin ecosystems across different public chains. The transaction volumes of USDC on Base and Ethereum are primarily driven by flash loans and liquidity rebalancing; Ethereum's USDT balances flash loans with centralized exchange capital flows; while Tron USDT has almost no large-scale DeFi transactions and possesses the largest volume of unmarked transactions.

Conclusion

The on-chain transfer scale of stablecoins has reached a substantial level, often compared to major global payment networks. However, the vast majority of current trading volume essentially constitutes internal liquidity scheduling of the cryptocurrency market: liquidity provisioning and rebalancing, arbitrage execution, and cross-platform fund settlements. These applications are real and effective, enhancing liquidity, trading efficiency, and global accessibility of the cryptocurrency asset market.

At the same time, the surface-level massive transfer volume should not be simply equated with personal payments or activities in the real economy. Stablecoins currently play more of a role as the underlying settlement layer in the cryptocurrency asset market, while payments, cross-border remittances, and corporate B2B scenarios are still in the process of being cultivated. Looking ahead, the quality of stablecoin transactions will be as important as transaction scale. The differences in issuance and turnover rates can intuitively reflect how stablecoin funds circulate and allocate within the cryptocurrency market.

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