Stablecoin velocity hits 49.7x annualized as real-world payments grow, while bitcoin and ether ETFs face $6.6B in sustained outflows. The divergence tests whether institutional demand is durable.
Stablecoin use is accelerating beyond crypto trading, with filtered transaction velocity reaching a record 49.7 times annualized. At the same time, bitcoin and ethereum spot ETFs are facing sustained outflows, raising questions about the depth of institutional demand.
Stablecoins are showing signs of a major shift from trading tool to payments infrastructure, even as crypto exchange-traded funds (ETFs) struggle to hold investor capital.
A report by DWF Labs, using filtered data from Visa and Allium Labs shows stablecoin velocity has reached an annualized record of 49.7 times. The metric measures how often each tokenized dollar changes hands in a year. A higher figure suggests stablecoins are being used more actively, rather than sitting idle in wallets or exchange accounts.
The market now includes about $320 billion in stablecoins. In less than five months this year, those tokens have processed $6.64 trillion in filtered transaction volume. The data removes bots, high-frequency trading loops and internal transfers.
The composition of that activity is also changing. Remittances, business-to-business payments, and consumer payments are now the fastest-growing areas. Exchange-linked volume, once the main driver of stablecoin use, has fallen to a smaller share of total activity.
That shift marks what analysts describe as the third phase of stablecoin adoption. From 2019 to 2021, growth was largely speculative, with velocity holding between 24 and 28 times as supply expanded. From 2022 to 2024, stablecoins were stress-tested during the Terra and FTX collapses, with velocity peaking at 34.2 times as users moved funds away from riskier venues.
Since 2025, transaction volume has grown faster than supply. Velocity first rose to 39.3 times and has now climbed to 49.7 times, pointing to broader real-world use.
The trend contrasts with spot crypto ETFs, where demand has weakened. Bitcoin ETFs have now seen their longest sustained outflow period since launch, following six straight quarters of net inflows. Outflows began in October 2025 and have continued across three quarters. Total drawdowns from the peak have reached $6.6 billion.
Earlier ETF outflows were often driven by investors leaving Grayscale's higher-fee GBTC and moving into cheaper products such as Blackrock's IBIT or Fidelity's FBTC. Recent activity looks different. On May 27, IBIT itself saw outflows, while total net redemptions across issuers reached $733.4 million for the day.
That suggests some institutional buyers may be treating bitcoin ETFs as macro momentum trades, rather than long-term portfolio allocations.
Ethereum ETFs face a different problem. After launching in July 2024, they were hit by heavy redemptions from Grayscale ETHE, including $484 million on the first day. Demand later surged in July and August 2025, when Blackrock's ETHA attracted $4.2 billion and $3.38 billion, respectively.
That momentum has faded. Grayscale outflows have slowed, yet capital has not meaningfully rotated into rival products. Several issuers are posting flat flows, while ETHA saw outflows through much of May.
The result is a split market: stablecoins are gaining real economic traction, while crypto ETFs are testing whether institutional demand is durable or simply cyclical.
Stablecoin velocity hit an annualized record of 49.7 times in 2025, according to filtered data from Visa and Allium Labs reported by DWF Labs. The metric measures how often each tokenized dollar changes hands in a year. A higher figure means stablecoins are being used more actively, not sitting idle in wallets or exchange accounts.
The market now holds about $320 billion in stablecoins. In less than five months this year, those tokens processed $6.64 trillion in filtered transaction volume. The data removes bots, high-frequency trading loops and internal transfers.
The composition of that activity is also changing. Remittances, business-to-business payments, and consumer payments are now the fastest-growing areas. Exchange-linked volume, once the main driver of stablecoin use, has fallen to a smaller share of total activity.
That shift marks what analysts describe as the third phase of stablecoin adoption. From 2019 to 2021, growth was largely speculative, with velocity holding between 24 and 28 times as supply expanded. From 2022 to 2024, stablecoins were stress-tested during the Terra and FTX collapses, with velocity peaking at 34.2 times as users moved funds away from riskier venues.
Since 2025, transaction volume has grown faster than supply. Velocity first rose to 39.3 times and has now climbed to 49.7 times, pointing to broader real-world use.
| Phase | Period | Velocity (annualized) |
|---|---|---|
| Speculative | 2019–2021 | 24–28x |
| Stress-test | 2022–2024 | 34.2x (peak) |
| Real-world | 2025 | 49.7x |
The simple read is that stablecoins are being used more. The better market read is that the mechanism has changed. Velocity rising faster than supply means each stablecoin dollar is turning over more frequently, not just that more tokens are being minted. That implies real economic activity – payments, settlements, and commerce – rather than speculative churn.
From 2019 to 2021, velocity stayed in a narrow band because most volume was exchange-driven: traders moved stablecoins between wallets and order books. The stress-test phase saw a spike as users fled risky platforms, that was a one-time event. The current phase shows sustained acceleration even as supply grows, suggesting stablecoins are becoming a payments rail.
Key insight: Stablecoin velocity rising faster than supply indicates real economic use, not speculative churn. If velocity stays above 40x while supply grows moderately, the thesis of structural adoption is confirmed.
While stablecoins gain traction, spot crypto ETFs are bleeding capital. Bitcoin ETFs have now seen their longest sustained outflow period since launch, following six straight quarters of net inflows. Outflows began in October 2025 and have continued across three quarters. Total drawdowns from the peak have reached $6.6 billion.
Earlier ETF outflows were often driven by investors leaving Grayscale's higher-fee GBTC and moving into cheaper products such as Blackrock's IBIT or Fidelity's FBTC. Recent activity looks different. On May 27, IBIT itself saw outflows, while total net redemptions across issuers reached $733.4 million for the day.
That suggests some institutional buyers may be treating bitcoin ETFs as macro momentum trades, rather than long-term portfolio allocations. The rotation from GBTC to lower-cost funds was a one-time structural shift. The current outflows are broad-based, hitting even the most popular products.
Ethereum ETFs face a different problem. After launching in July 2024, they were hit by heavy redemptions from Grayscale ETHE, including $484 million on the first day. Demand later surged in July and August 2025, when Blackrock's ETHA attracted $4.2 billion and $3.38 billion, respectively.
That momentum has faded. Grayscale outflows have slowed, yet capital has not meaningfully rotated into rival products. Several issuers are posting flat flows, while ETHA saw outflows through much of May.
The result is a split market: stablecoins are gaining real economic traction, while crypto ETFs are testing whether institutional demand is durable or simply cyclical.
The divergence creates a clear decision point for traders. Stablecoin velocity data suggests the infrastructure layer is maturing. Remittances, B2B payments, and consumer payments are now the fastest-growing segments, according to the DWF Labs report. That is a structural shift, not a trading pattern.
Crypto ETFs, by contrast, are behaving like momentum vehicles. The outflows from IBIT and ETHA indicate that even the largest, lowest-cost products are not immune to redemption pressure. If institutional buyers were treating these as long-term allocations, they would be less likely to redeem en masse during a macro drawdown.
Risk to watch: If stablecoin velocity drops back below 30x, the real-world use thesis weakens. If ETF outflows reverse and new inflows resume, institutional conviction may be stronger than the current data suggests.
The data from Visa and Allium Labs, combined with the ETF flow patterns, paints a picture of a market in transition. Stablecoins are becoming a payments infrastructure. Crypto ETFs are testing whether institutional demand is real or just a momentum trade. The next quarter of flow data will determine which narrative holds.
For more on the broader crypto market dynamics, see our crypto market analysis. For individual asset profiles, see Bitcoin (BTC) profile and Ethereum (ETH) profile.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.