Binance-Circle Deal Puts Pressure on Tether's Dominant Stablecoin

A recent partnership expansion between Binance and Circle has sent shockwaves through the stablecoin market. The two companies have agreed to buy $100 million of Circle shares and expand USDC use and integration on Binance's platform over the next five years.

This development puts pressure on Tether (USDT), the top player in the global stablecoin market, as Binance's user base and infrastructure are leveraged to grow USDC. According to crypto data provider Kaiko, Binance's USDC-based spot markets have increased to 329 from 140 since the partnership began in December 2024.

The monthly USDC trading volume has also climbed to more than $80 billion recently from about $20 billion to $40 billion before the partnership. However, experts say that USDC would struggle to displace USDT in the short term, citing its deep trading liquidity and local liquidity.