Summary While USDC is positioned to capture a larger share of regulated stablecoin market growth, USDT retains an unshakeable lead in peer-to-peer transactions across emerging markets. Emerging USDT-centric chains such as Plasma and Stable aim to capture USDT-related economic activity currently concentrated on Ethereum and Tron. Both Plasma and Stable face a common challenge among token projects: launching their tokens well before demonstrating meaningful usage or revenue. While USDC is positioned to capture a larger share of regulated stablecoin market growth, USDT retains an unshakeable lead in peer-to-peer transactions across emerging markets. Emerging USDT-centric chains such as Plasma and Stable aim to capture USDT-related economic activity currently concentrated on Ethereum and Tron. Tron can be viewed as the incumbent USDT-centric chain, benefiting from low fees and early-mover advantage; however, this position may be challenged by newer USDT-focused networks backed by companies affiliated with Tether ( USDT-USD ). Both Plasma and Stable face a common challenge among token projects: launching their tokens well before demonstrating meaningful usage or revenue. These projects have long-term potential, but the current timing is not yet attractive for entering a position. Tether USDT Unshakable Market Position Circle’s USDC is expanding rapidly as the largest regulated stablecoin and is well positioned to capture the largest share of regulated market growth in developed markets in coming years. However, will it replace Tether’s USDT? The answer is likely no. Tether’s USDT was the earliest mover in the stablecoin market, launching in 2014, years before USDC. This first-mover advantage enabled USDT to become deeply embedded in the crypto ecosystem. Major exchanges adopted USDT as a base currency for trading pairs, effectively making it a de facto quote currency. Source: Dune Dashboard While USDC’s regulated status has also accelerated its adoption as a quote currency in exchanges, USDT retains another powerful competitive edge which USDC cannot match: its network effect in everyday stablecoin usage across emerging markets. In regions such as Southeast Asia, Africa, the Middle East, and Latin America, individuals rely on USDT for peer-to-peer payments, remittances, and savings. According to Tether’s own estimates, roughly 50–60 percent of USDT transactions in 2025 are tied to real-world economic activity. Source: Cryptopolitan While USDC dominates the regulated stablecoin segment and is widely integrated with institutions and DeFi applications, USDT remains the preferred stablecoin for retail users despite its uncertain regulatory standing. The network effects built through millions of daily users have made USDT’s position in global retail usage difficult to displace. Proxy Exposure to USDT's Success via USDT-Centric Layer 1 Chains Because Tether remains a privately held company, retail investors currently have no direct channel to participate in its growth. Recently, reports have surfaced that Tether is considering tokenizing its shares on-chain, which could theoretically provide liquidity for the company’s equity. However, there is no clarity on whether this would constitute a public offering or simply create an exit mechanism for existing shareholders, nor is there any timeline for such a proposal. Tether is no question a cash-printing giant. The company generated over $10 billion in net profit for the first nine months of 2025. This has led some to look at alternative ways to gain exposure to Tether's success, including projects that have a direct economic link to Tether. Two notable projects are Plasma and Stable, both are Layer 1 blockchain built specifically around Tether's USDT and invested by Tether's sister company. Both networks feature paying gas fees in USDT and want to capture the USDT-related economic activities that are currently happening on other blockchain. This is similar to what Circle's Arc chain is aiming for USDC as well. Every on-chain transaction requires users to pay gas fees to the underlying blockchain. For USDT, most of its activity currently takes place on Ethereum ( ETH-USD ) and Tron ( TRON ), which means users must purchase and then pay ETH or TRX to cover gas fees whenever they move or interact with USDT. These USDT-centric chains design choices are that USDT itself can be used to pay gas fees on the network. If these chains succeed in pulling a meaningful share of USDT-related activity onto their own chain, the gas fees that are currently captured by Ethereum or Tron could instead flow back to these chains. It is important to point out Plasma and Stable can offer some exposure to USDT-fueled growth, yet they are fundamentally different from owning Tether shares. Tether's profit comes from reserve investments, which accrue to Tether's shareholders. Holders of STABLE (the native token of Stable Chain) or XPL (the native token of Plasma Chain) do not have rights to Tether's earnings. Their value must come from network utility and good tokenomic design, including staking rewards or governance value. Tron as the Current USDT Chain Most of the USDT supply is currently on Ethereum (47%) and Tron (43%). While Ethereum is a generalized Layer 1 blockchain, Tron can be viewed as a USDT-centric chain. On Tron, 99% of the stablecoins are in USDT, with almost no presence of other stablecoins. Tron's early support for USDT and relatively cheaper gas fees compared to Ethereum helped it become the dominant network for peer-to-peer USDT transactions. Most centralized exchanges set Tron as the default network for USDT withdrawals, and over-the-counter desks commonly rely on Tron to facilitate USDT flows. Beyond serving as a transactional rail for USDT, Tron hosts relatively few decentralization applications. In contrast to Ethereum’s thousands of decentralized applications, Tron's ecosystem is limited and highly concentrated. Its DeFi activity is largely centered around a small group of projects associated with founder Justin Sun. Whereas Ethereum is regarded as the most decentralized Layer-1 network, Tron is frequently criticized for being comparatively centralized and controlled by a small group of actors. Despite these concerns, Tron consistently ranks among the top 10 Layer-1 chains by market capitalization, currently exceeding $26 billion. This high market capitalization illustrates the valuation potential that a successful USDT-centric chain could achieve. Given this landscape, it may be challenging for emerging USDT-centric chains such as Plasma and Stable to pull significant USDT activity away from Ethereum, where institutional users prioritize decentralization and security. However, when it comes to Tron, these newer chains have meaningful potential to capture a substantial share of USDT-related activity. They both offer near-zero fees and high throughput for USDT transactions, which are the main advantages of the Tron offer compared to Ethereum. Majority of USDT Supply on Ethereum and Tron Chain Source - DefiLlama Tron is essentially a USDT-centric Chain Source - DefiLlama Devastating Token Performance After Launch Plasma conducted its token generation event ((TGE)) in September 2025, and Stable followed its TGE in December. Although both projects attracted significant attention within the crypto community, their tokens have experienced devastating performance since launch. While part of this reflects broader market sentiment, which has been pretty weak since the early October market crash, there are a number of fundamental factors that help explain their poor performance. Highly Concentrated Token Allocation The tokenomics designs of both Plasma and Stable are quite similar, and both exhibit characteristics typically associated with poor post-launch performance: low circulating float, heavy insider concentration, and limited utility for the native token. Both tokens allocate 50% of the total supply to the team and private investors, which is quite high for a public Layer-1 network. This raises several concerns, including significant future unlock overhang and heightened perceived selling pressure once cliff and vesting periods expire. Investors anticipate substantial dilution over time as investors and the team's allocation unlock and sell into the market. Both projects allocate 40% of the total token supply to ecosystem development, which appears supportive of long-term growth on paper, but in practice this category often raises further concerns. Tokens allocated to ecosystem usually remain controlled by the team, and the distribution timelines and conditions for using these portions of tokens are unclear. The eventual release of these tokens into circulation means further supply overhang. Compounding these issues, both projects launched with only 18% circulating supply. Within this limited float, 10% was allocated to airdrops, liquidity, market makers, exchanges, and strategic partners, while the remaining 8% was directed toward liquidity, partners, and ecosystem-related growth. As a result, nearly all circulating supply at launch was promotional or operational in nature rather than organically distributed to users or long-term holders. Plasma Native Token XPL Stable Native Token Allocation Still in Early Development Phrase Unlike Circle, which entered the public markets as a mature company with a proven business model and stable recurring revenue, these projects remain in a very early stage of development. This reflects a broader structural pattern in the crypto market, where early-stage projects are able to issue tokens and access liquidity well before establishing a sustainable business or demonstrating clear product-market fit. This dynamic is not inherently negative. It creates opportunities for investors to participate in promising projects at an early phase and potentially achieve outsized returns if the underlying thesis proves correct over time. However, it also requires disciplined risk management. Early-stage token projects often follow a familiar trajectory: an initial wave of hype, extremely high fully diluted valuations, and then a sharp decline as insiders sell into retail demand. For cautious investors, the key is to avoid being caught in this initial hype cycle before fundamentals have materialized. Conclusion For both Plasma and Stable, the thesis is sound and the future potential is real, but the timing is not yet right. What investors should do is: Review the token unlocking schedule and avoid entering a position before the large team and investor unlocks expected in mid- to late-2026. Monitor their development, including growth in USDT supply on each chain and integration with real-world use cases. In mid- to late-2026, after the major token unlocks, investors can reassess the projects’ development progress and determine whether it is an appropriate time to establish a position. Disclaimer: The information provided herein does not constitute investment advice, financial advice, trading advice, or any other sort of advice, and should not be treated as such. All content set out below is for informational purposes only. Original Post Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.
