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Ahmed Barakat
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CryptoNews Editorial Team
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For several hours, at the beginning of this week, Tether USDT stablecoin had a higher market capitalization than Ethereum, the first time this has happened in eight years. Data on multiple trackers put both items in the $183-188B range, with one chart showing USDT at $187B versus ETH at $186B, a spread of $1B.
The flip took hours, and ETH regained second place after the price stabilized. The mechanism that created the crossover, the sustained USDT rally that continued to weaken the ETH price, did not end when the balance was reversed.
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Crypto Market Structure: Tether USDT Flippening
This was not a surprise offering on the Ethereum side. What pressured the ETH market was the price, and what boosted USDT was the release. Tether’s own Q4 2025 evidence showed USDT at a record $187.3B, having added $12.4B in one quarter even when the crypto market was holding a knife to fall.
By the beginning of 2026, the USDT market rose from $144.2B to $184B in twelve months, a growth of 28%, while the dollar value of ETH moved in the opposite direction.
In the three weeks leading up to the crossover, more than $7B was withdrawn from the stablecoin sector while $400B was withdrawn from the entire crypto market. Ethereum’s DeFi TVL drops to $36B. Merchants were not giving up coins; they were stopping the cars while they were destroying the unsustainable things.
USDT’s share of the entire stablecoin sector sits at 59%, with USDT and USDC together accounting for 82%, which means that Tether is not a dominant player in this scenario.
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Mike McGlone’s warning: It doesn’t stop at Ethereum
Bloomberg Intelligence chief market analyst Mike McGlone has been following this trend longer than most. In October 2020, McGlone wrote that USDT, then $16B versus $43B for ETH, was. Ethereum exchange rate at the current Ethereum price. description as part of “unchanged direction” stablecoins with high revenue.
McGlone’s revised proposal goes further. They look forward to it “continue to continue,” and Tether market to top Ethereum in 2026 and “after Bitcoin.” What they show: if Bitcoin falls to $10,000, USDT, which would need to grow 7x from current levels, could challenge BTC for the top spot.
We are not currently accepting $10,000 BTC transactions. But dismissing it entirely because it sounds extreme is how people missed the USDT-flips-ETH call in the first place.
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ETH and USDT Now: Differences, Recovery, and What’s Next
As of today, Ethereum has taken the second place in the market, but the margin is not comfortable. ETH will need to continue its price recovery, or the release of Tether USDT will need to rise above the level for the second position to be safe again.
There is no guarantee anymore. The exchange of Ethereum to Ethereumincluding the development of ZK-proof scaling, provides long-term interest, but the incentives work at a different time than the price weakness that led to June. turn it over.
The USDT contribution schedule shows no change. Tether raised $12.4B in the first quarter in a down market. In neutral or vulnerable environments, the speed can be faster. At the $1 peg, the market cap and the circular distribution are the same, so every new USDT created is at the market rate, without the price fluctuations that drive the ETH balance.
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