Tether’s Global Footprint: Tokenization and USDT-Centric Infrastructure

In the evolving digital asset landscape, a common debate centers on whether Circle’s USDC, widely regarded as the poster child for regulated and transparent stablecoins, will eventually eclipse Tether (USDT). While USDC is undoubtedly the preferred choice for institutions and the regulated "on-chain" economy, it is still too early to assert that it will surpass Tether.

Tether’s dominance is protected by a massive network effect and a decade-long head start. Since its launch in 2014, USDT has become the "reserve currency" of the crypto markets. It is the primary liquidity pair on global exchanges, serving as the functional unit of account for traders. However, its dominant lead lies in its adoption within emerging markets.

USDT and USDC's Trading Volume on Centralized Exchanges

Source: Dune Dashboard https://dune.com/blofinresearch/main-stablecoins

In regions such as Southeast Asia, Africa, the Middle East, and Latin America, large numbers of people now use USDT for peer-to-peer transfers, remittances, merchant payments, and simple dollar savings. On-chain data shared by Tether shows very large volumes of small-value transfers (≤$1,000), which line up more with day-to-day payments and household finance than with speculative trading. That transactional pattern is consistent with Tether’s claim that a significant share of USDT flows are tied to real-world economic activity rather than speculative trading. This "street-level" adoption creates a moat that regulatory compliance alone cannot cross.

The result is a split structure: USDC dominates the regulated, institution-facing segment and is deeply woven into DeFi and corporate workflows, while USDT functions as the default “dollar” for millions of retail users globally despite relatively weaker regulatory standing. Given this installed base and usage in high-frequency, necessity-driven transactions, USDT’s position in global retail usage is very hard to displace in the medium term.

Tether's Ambition: Tokenization & USDT-Centric Chains

Because Tether is privately held and not publicly listed, there is currently no straightforward “Tether stock” for retail investors to buy. Recently, Tether has been reported to be exploring a large equity raise at a target valuation around $500 billion and is weighing tokenization of its shares after the round. If implemented, that could eventually create a liquid, on-chain representation of Tether equity – but there is still no detailed structure or timetable, and it is unclear whether such tokens would function like traditional public equity or primarily provide liquidity to existing shareholders.

What is clear is that Tether is extraordinarily profitable. Attestations for 2025 show net profit in excess of $10 billion for the first three quarters alone, driven mainly by income on reserves such as U.S. Treasuries and other assets backing USDT. This has naturally led market participants to look for indirect ways to gain exposure to the economic growth around USDT. One emerging route is through projects whose economics are tightly linked to USDT flows. Plasma and Stable are prominent examples: both are new Layer-1 blockchains designed around USDT as the primary transactional asset and both are backed by entities closely tied to Tether, including Bitfinex (Tether’s sister company in the iFinex group) and Tether’s executives.

Their core idea is simple: today, most USDT activity happens on general-purpose chains like Ethereum and Tron. Users pay gas in the native token of those chains (ETH, TRX, etc.), so a portion of the economic value generated by USDT transactions accrues to those base networks rather than to the “USDT stack” itself. By building USDT-native chains where gas can be paid directly in USDT (or USDT-derived units like gUSDT or USDT0), Plasma and Stable try to pull some of that value – transaction fees, MEV, and related economics – into a dedicated USDT-focused environment.

However, it’s crucial to distinguish economic linkage from equity ownership. Tether’s profits come primarily from investing the reserves backing USDT; those profits belong to Tether’s shareholders. Holders of XPL (Plasma’s token) or STABLE (StableChain’s token) do not own those reserves and have no legal claim on Tether’s earnings. If achievable, their upside must come from:

• The growth and stickiness of the network itself (transaction volume, TVL, developer activity).
• Fee capture and MEV at the protocol level.
• The specific tokenomics (staking rewards, validator incentives, and governance value) that route some of that activity back to the token.

In other words, these chains can be a way to get exposure to infrastructure that is leveraged to USDT’s growth, but they are fundamentally different from owning Tether equity.

From Tron to Plasma and Stable

Right now, most of the USDT supply and transactional activity is split between Ethereum and Tron, with Tron in particular emerging as the main rail for stablecoin transfers. Multiple datasets show that Tron hosts more than half of all circulating USDT and that USDT accounts for ~98–99% of all stablecoins on Tron. That effectively makes Tron a USDT-centric chain already.

Tron’s value proposition is straightforward: low fees and high throughput. These characteristics made it attractive for exchanges, OTC desks, and users who need cheap, fast USDT transfers. Many centralized exchanges now default to Tron as the standard network for USDT withdrawals, especially for retail users and cross-border flows. That’s also why remittance and P2P activity in USDT is so heavily skewed toward the TRC-20 version.

From a broader ecosystem perspective, Tron looks very different from Ethereum. Ethereum supports thousands of dApps spanning DeFi, NFTs, gaming, and more, and is widely seen as more decentralized, with a very large validator. Tron, by contrast, runs a Delegated Proof-of-Stake model with 27 “Super Representatives,” a design that enables high throughput and low costs but has repeatedly drawn criticism for centralization risk. Its on-chain activity is heavily dominated by stablecoin transfers rather than a broad distribution of independent DeFi protocols.

Despite these concerns, Tron has grown into one of the largest Layer-1 networks by market capitalization and processes huge volumes of USDT transfers. This gives a useful benchmark: it shows the kind of valuation a chain can support when it becomes the primary settlement layer for USDT, even if its broader ecosystem is relatively concentrated.

For Plasma and Stable, this context matters. Winning over Ethereum’s DeFi user base is likely to be challenging because Ethereum is still the preferred environment for institutional-grade security, composability, and decentralization. But Tron’s role as a USDT payment rail – especially for high-frequency, low-value transfers – is more contestable. If the new USDT-native chains can deliver better UX (near-zero fees, cleaner gas abstraction, and enterprise-oriented tooling) without undermining reliability, they have a realistic chance of siphoning off some of the transactional flows that currently live on Tron.

USDT Supply Across Different Chains

Total Tron Stablecoins Market Cap (USDT accounts for 98.47%)

Source: Defillama

Conclusion

USDT has entrenched itself at the retail and capital-controlled environments of the global dollar system, particularly in regions where access to banks, FX markets, or stable local currencies is limited. That installed base of necessity-driven usage is hard to dislodge on any 3–5 year view, even if USDC continues to gain share in the regulated on-chain economy. On the capital side, Tether’s extraordinary profitability and potential tokenization plans highlight how much value has accumulated at the reserve layer. On blockchain side, its new generation of USDT-native chains like Plasma and Stable, their economics depend on whether they can attract and retain flows away from incumbent rails like Tron or Ethereum.