$CFX

USDT dominance rate approaches 4.8%: Risk for altcoins or investment opportunity?

In the coming weeks, the market may enter a new phase of volatility, as analysts forecast that the dominance rate of Tether (USDT) will rise to the range of 4.7%–4.8% — a level previously associated with strong corrections in altcoins back in April 2025.

The increasing influence of stablecoins often reflects the defensive sentiment of investors, as capital moves away from risky assets like altcoins to seek safer havens.

However, the picture regarding stablecoins is not solely about caution. USDe from Ethena (ENA) has added $2.7 billion to its supply in a short time, indicating that confidence and capital inflow into this sector remain very strong.

As the USDT dominance rate peaks, the liquidity that has been “waiting” on the sidelines may return to altcoins — opening up opportunities for a significant recovery in the latter part of Q3 this year.

Analyst warns of a strong correction

According to shares from Web3Niels – co-founder of Ted Labs and partner at Bybit – the dominance rate of USDT is likely to increase to the range of 4.7%–4.8% in the coming weeks, coinciding with levels that have previously led to significant corrections in altcoins.

Citing the volatility in April 2025, he warns that a rapid increase in the dominance rate of stablecoins often reflects a risk-averse sentiment, as investors seek safe assets and withdraw capital from altcoins — thereby putting widespread downward pressure.