Tether's Ethereum Wallets Plummet by Quarter-Million Addresses

Tether's Ethereum-based USDT wallets saw a significant decline in recent days. Analytics firm Santiment noted that non-empty wallet counts fell by 251,350 over an 11-day period, marking one of the steepest declines in Tether holder activity on Ethereum in recent memory.

This drop represents a 0.54% decline in a metric that almost never moves backward. However, it's essential to consider the context and possible explanations for this decline. Santiment draws parallels with a similar episode from December 2024, where a comparable drop in non-empty USDT addresses preceded a nearly 10% rally in Bitcoin's price.

The firm also suggests that address consolidation is another factor contributing to the decline. Users and services often merge balances from multiple wallets into fewer, larger ones, which can deflate wallet counts without any actual capital leaving the ecosystem.

Tether's own operational activity, such as burning $2.5 billion in USDT on the Ethereum network on July 7, 2026, may also be a contributing factor. However, there is no direct evidence linking the wallet decline to Tether's blacklisting or freeze operations, which have been part of its compliance efforts.