Bitcoin’s dominance in the digital-asset market has fallen to its lowest level in two years as investors continue to move capital into stablecoins. ARK Invest’s Cathie Wood noted that the shift reflects a broader evolution in the crypto economy, where liquidity, risk management, and regulatory clarity are driving users toward dollar-pegged assets.
According to market data, Bitcoin’s share of total crypto transaction volume has dropped below 42 percent in early November 2025, compared with more than 51 percent in mid-2024. Stablecoins such as USDT, USDC, and RLUSD now represent nearly 60 percent of global digital-asset settlements. Analysts say the growing preference for stability is reshaping liquidity flows and altering the dynamics of on-chain finance.
Cathie Wood emphasized that the rise of regulated stablecoins signals a more mature phase for the crypto industry. She explained that these tokens offer predictable value and faster settlement while reducing volatility risks for institutional investors. As central banks finalize stablecoin frameworks, integration with banking systems has become a critical theme in digital-finance innovation.
The migration toward stablecoins is also linked to a surge in tokenized payments and on-chain treasury activity. Payment processors and fintech firms are using stablecoins to move funds across borders in real time, eliminating the delays and fees of traditional systems. This trend has accelerated since the second quarter of 2025, when major banks and payment companies launched blockchain-based settlement pilots in the United States, Europe, and Japan.
Institutional investors have taken note of the shift. Hedge funds and liquidity providers are increasingly holding stablecoins as core assets for market operations. The tokens are now used not only for trading pairs but also for lending, yield management, and tokenized-asset settlement. These developments underscore how stablecoins have evolved from a niche trading tool to a backbone of the digital-asset economy.
Market strategists suggest that Bitcoin’s reduced market share does not necessarily indicate weakness but rather diversification. As the ecosystem expands, new products such as stablecoins, tokenized bonds, and regulated digital-currencies are claiming larger portions of total liquidity. Analysts expect Bitcoin to maintain its role as a store of value while stablecoins dominate short-term transactions and institutional flows.
The data also reflects growing demand for transparency and compliance. Stablecoin issuers have strengthened reserve disclosures, publishing real-time attestations and holding assets primarily in U.S. Treasuries. These measures have increased confidence among investors and regulators, helping stablecoins gain traction as reliable instruments for global finance.
The shift from volatile assets to stable payment instruments marks a defining moment for the crypto market in 2025. With institutional adoption accelerating and clear regulatory frameworks emerging, stablecoins appear set to become the primary vehicle for liquidity and payments across the digital-finance landscape.
