Market Overview
Ethereum's stablecoin volume reached a record high of $2.82 trillion in October 2025. This significant surge occurred despite a general decline in the cryptocurrency market, with both Ethereum (ETH) and Bitcoin (BTC) experiencing double-digit losses during the same period. The increased stablecoin activity suggests a strong demand for capital preservation and yield strategies among traders who are awaiting improved market conditions.
USDC and USDT are the primary contributors to this surge, with volumes of $1.6 trillion and $900 billion, respectively. On-chain data indicates that Ethereum continues to serve as the principal settlement layer for the majority of stablecoins and decentralized finance (DeFi) activities.
Impact on Stablecoin Issuers
Key stablecoin issuers involved in this trend include Circle, Tether, and MakerDAO. While no direct statements from Ethereum Foundation leaders have been identified concerning this recent surge, Vincent Liu, CIO at Kronos Research, noted that investors are rotating into stablecoins to preserve capital and earn yield, while holding funds in anticipation of new market opportunities.
Stablecoin issuers are now accounting for 65% to 70% of daily protocol revenue on Ethereum. This revenue is primarily generated from interest earned on US Treasury holdings that back the stablecoins. The increased focus on stablecoins highlights a notable shift in trader preferences amidst a challenging market environment.
Price Trends for Ethereum and Bitcoin
Ethereum's price has seen a decline of approximately 12-16% over the last 30 days, trading between $3,800 and $3,900 as of November 3, 2025. Bitcoin also experienced a drop of about 11.5% during the same period, maintaining a high correlation with equities.
Stablecoins, such as USDC, USDT, and DAI, exhibited significant volume shifts during this time, with USDC and USDT volumes increasing substantially. In contrast, DAI's volume declined. This pattern aligns with historical trends where stablecoin volumes tend to rise during risk-off periods in the crypto market.
Stablecoin Dominance on Ethereum
The surge in stablecoin volumes signifies that they now dominate on-chain activity, holding the largest share of protocol revenue. While there has been no major reported change in the total value locked (TVL) in Ethereum, there is a visible rotation of capital into stablecoins from more volatile assets. Ethereum staking and major DeFi protocol flows remain steady, but they show capital outflows from riskier assets towards stablecoins.
This pattern closely mirrors past bear market phases, such as the one observed in 2022, where stablecoin volumes surged amid declining prices of major assets. Historically, such surges in stablecoin dominance can precede later market recoveries. However, the precise timing of such recoveries remains uncertain and is contingent upon broader macroeconomic and regulatory factors.
Current Market Sentiment
No new statements have been issued by prominent crypto leaders, including Vitalik Buterin or Joseph Lubin, regarding these recent developments. Sentiment on public forums such as Reddit and Telegram appears cautious, with discussions primarily centering on capital protection and awaiting macroeconomic triggers.
In terms of regulatory updates, no new statements have been released by authorities like the SEC or CFTC concerning the surge in stablecoin volumes. Exchanges such as Coinbase have reported strong revenue linked to USDC and stablecoin inflows without announcing new compliance actions.