Last Updated on September 2, 2025 by Olga Davis
Crypto lending hit a record $44.25 billion in Q2 2025, combining a 42.1% surge in DeFi crypto-collateralized loans to $26.47 billion with $17.78 billion in CeFi lending, per Galaxy Research. Tether crypto (USDT), a stablecoin pegged to the dollar with less than 0.1% wiggle room, anchors this boom, driving $10.14 billion of the CeFi market – a 57% share. With Bitcoin roaring at $108,000, USDT’s $500 billion annual transaction volume lets traders and institutions tap liquidity without selling assets. A $3 billion USDT mint in August 2025 juiced trading volumes by 20-30%, signaling a red-hot market. Join us as we explore USDT’s dominance, market impact, and how traders and corporate treasuries can ride this wave.
CeFi and DeFi Lending Market Size. Source: galaxy.com
Tether Crypto’s Dominance in Lending
Tether stands as the unshakable backbone of crypto lending platforms delivering the stablecoin liquidity that fuels the 2025 bull market. Here’s why USDT rules the lending landscape:
Unmatched Stability
Supported by more than $120 billion in reserves, including US Treasuries, USDT maintains a nearly perfect dollar peg with a deviation of less than 0.1%. For borrowers who require a loan value that is predictable without the volatility of Bitcoin or Ethereum, this stability makes it the preferred currency.
Expansive Reach Across Blockchains
USDT is available on multiple blockchains, with 72% of its supply on Ethereum and Tron. This broad presence ensures deep liquidity and easy integration for lending platforms. Borrowers typically post more crypto as collateral than the loan’s value (overcollateralization), and USDT’s stability makes this model secure. Recent integrations like Bitcoin’s RGB protocol and Lightning Network support via Spark’s Wallet Development Kit extend USDT lending into Bitcoin ecosystems.
Liquidity Powerhouse
One of the largest issuances of the year, Tether’s $3 billion USDT mint in August 2025, injected fresh liquidity into the market and boosted trading volumes by 20–30%. This capital inflow fueled increased activity across CeFi and DeFi platforms, tightened spreads, and supported arbitrage opportunities. A 0.8% increase in Bitcoin earlier that month accompanied a smaller $1 billion mint as traders shifted the new USDT into cryptocurrency assets. Every issuance serves as a catalyst, creating waves of liquidity and indicating possible market rallies, highlighting Tether’s function as more than just a tool for settlement.
Resilience Through Crises
The 2022 CeFi crash, triggered by the collapse of Genesis and Celsius platforms, slashed lending volumes from $34.8 billion to $6.4 billion. Throughout this turmoil, USDT provided a stable settlement medium that helped maintain market confidence. By the end of 2024, USDT played a key role in the CeFi lending market, supporting a significant portion of the $11.2 billion in outstanding loans. Its stability and broad adoption have made it the preferred stablecoin for many centralized lending platforms.
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Tether Crypto for Traders
By providing traders with stability and flexibility, USDT acts as a link between the crypto ecosystem and conventional financial activity. Instant access to liquidity, smooth trade settlement, and international transactions free from exposure to volatile assets are all made possible by USDT, which is pegged to the dollar. Here’s what Tether crypto can be used for:
Seamless Market Access
Tether crypto enables traders to act quickly on short-term market movements across multiple exchanges without converting their core crypto holdings into fiat. A trader may, for instance, purchase Bitcoin on one exchange where it is marginally less expensive and then sell it on another for a small profit (arbitrage). Similar to this, USDT makes it possible to execute Ethereum or other positions quickly while utilizing price discrepancies or market inefficiencies. Even big trades can be executed effectively thanks to the deep liquidity and low slippage execution of major trading pairs like BTC/USDT and ETH/USDT.
Real-World Utility
Tether crypto has become a practical medium of exchange beyond trading. From online subscriptions to reservations for trips, people use it to pay for commonplace goods and services. It also makes international money transfers easy. Businesses can pay foreign suppliers without the use of traditional banks, freelancers can bill clients in USDT and receive payment instantly, and traders can move money between exchanges to capitalize on market opportunities. This positions USDT as a tool for the cryptocurrency market and a bridge to real-world financial transactions, providing users with speed and flexibility.
Strategic Flexibility
USDT’s stable dollar peg gives traders a steady hand when managing their portfolios. Without selling your heavyweights like Ethereum or Bitcoin, you can move money between coins, take advantage of opportunities in the launch of popular new tokens, or avoid market turbulence. Think of it as a stable tool to navigate volatility. Traders can convert Bitcoin or Ethereum into USDT to preserve value during market dips, while holding onto their main assets. Alternatively, you have Tether crypto ready to jump in quickly if a promising new altcoin emerges. It all comes down to remaining agile, precisely managing risks, and taking risks while maintaining the security of your core holdings.
Tether Crypto for Corporate Treasuries
By preventing taxable events and maintaining market upside, USDT enables businesses to extract liquidity from cryptocurrency holdings without having to sell. In light of $3 billion in U.S. ETF inflows and Ethereum’s recent designation as a utility token under the CLARITY Act, corporate treasuries are increasingly using CeFi. USDT supports:
Operational Funding
USDT provides a simplified way to pay for running costs without having to sell off important cryptocurrency assets. For example, a tech company with Ethereum and Bitcoin can use USDT to instantly settle payments to foreign contractors, avoiding the high fees and delays associated with traditional cross-border banking. Similar to this, a retail company can use USDT to pay international suppliers, maintaining business continuity and protecting its cryptocurrency holdings for future growth.
R&D and Investments
USDT empowers companies to fund innovation and seize investment opportunities without selling their foundational crypto holdings. Let’s say a fintech business considers Bitcoin and Ethereum to be long-term investments and has sizable holdings of both. They use USDT to finance operational requirements, like paying foreign contractors or introducing a new product line, rather than selling off those holdings. They can keep pursuing expansion prospects while holding onto their advantageous positions in Bitcoin and Ethereum. This kind of flexibility is revolutionary because it enables companies to take bold and quick actions without risking their larger cryptocurrency investments.
Cash Flow Agility
The dollar peg and stability of USDT allow corporate treasuries to respond swiftly to strategic initiatives or market opportunities. Without compromising its core cryptocurrency holdings, a business may use USDT to support a significant partnership, finish a crucial acquisition, or take part in a time-sensitive token offering. In order to maintain their long-term cryptocurrency positions and respond precisely to changes in the market or internal investment requirements, multinational corporations can transfer large amounts between subsidiaries or exchanges with ease and at a low cost thanks to USDT.
DeFi vs CeFi: Tether Crypto’s Edge
Tether crypto is the lifeblood of both CeFi and DeFi lending, but they serve different needs. CeFi, with its centralized platforms, offers user-friendly, secure loan processes, ideal for those prioritizing safety. DeFi, holding a 59.83% market share with $26.47 billion in loans, offers higher returns but risks $3.1 billion in hack losses in H1 2025.
| Feature | CeFi Lending | DeFi Lending |
|---|---|---|
| USDT Role | Core currency for loan liquidity | Collateral or lending token |
| Market Share | 40.17% | 59.83% |
| Collateral | 150–200% overcollateralization | Varies; often lower |
| Security | Automated liquidation, low risk | Prone to smart contract exploits |
| Complexity | Low; intuitive platforms | High; needs protocol expertise |
| Reliability | High; stable infrastructure | Medium; smart contract risks |
Tether Crypto’s Entry Point: CoinRabbit
Born in 2020 and now a full-fledged crypto hub, CoinRabbit transforms the complexity of CeFi lending into a streamlined experience, making USDT accessible to everyone from solo traders to institutional players. By blending speed, flexibility, and a human touch, it lets users tap USDT’s stability without selling their Bitcoin or Ethereum. Here’s how CoinRabbit unlocks Tether potential:
- Fast, accessible loans with average processing in 10 minutes
- Flexible LTV up to 90% and easy repayment management
- Human support 24/7
- Accepts over 300 cryptocurrencies as collateral
- VIP and business solutions for high-volume users
With a built-in crypto wallet, exchange, and savings options, CoinRabbit is a great and simple way to leverage Tether crypto while keeping control of your assets. By linking USDT liquidity to easy-to-use platforms, corporate treasuries and traders can participate effectively in the $44 billion lending market.
