Tether Dominance: Why Stablecoins Inflate Crypto Volume Figures

The crypto market's most-traded asset is not Bitcoin, but rather Tether (USDT), which consistently outsells Bitcoin in volume. This phenomenon can be attributed to the way stablecoins are used in cryptocurrency trading.

In traditional markets, trade volumes are measured in shares, with the medium of exchange (dollars) being secondary. However, in crypto, every USDT that passes through a trade gets counted as USDT volume, making it appear as if more Tether is being traded than other assets.

This inflation in volume figures is due to four main mechanics: the same dollar getting counted multiple times, bots executing hundreds of transfers daily, exchanges inflating their reported volumes for marketing purposes, and wash trading. To accurately measure economic activity, analysts use adjusted volume, which strips out bot traffic and other non-essential movements.