CoinGecko Q3 2025 Report: Crypto Reclaims $4 Trillion, Powered by DeFi and Stablecoins

The cryptocurrency market extended its turnaround throughout three consecutive quarters into Q3 2025, propelling total capitalization to levels last observed in late 2021. According to CoinGecko, the sector added $563.6 billion in Q3, representing a 16.4% increase and bringing the industry to approximately $4.0 trillion.

This key figure encapsulates the scale of the recovery: after a challenging start to 2025 marked by geopolitical uncertainty, the market is regaining confidence. The third quarter is not merely a technical rebound, but rather the consolidation of a structural trend.

What distinguishes Q3 2025 from previous rallies is participation: average daily trading volume surged 43.8% compared to Q2, reaching $155.0 billion, reversing the slowdown that characterized the first half of the year and signaling a marked return of both retail and institutional activity.

Stablecoins cross the $300 billion threshold in Q4

The true common denominator of this rally? Stablecoins (USDT, USDC, USDe, etc.). These assets, often perceived as “crypto gold,” now play the role of backbone for decentralized markets.

The top 20 stablecoins increased their combined capitalization by $44.5 billion (18.3%) to reach an all-time high of $287.6 billion, with Ethena’s USDe and Circle’s USDC among the fastest growers.

However, raw numbers tell only part of the story. Ethena’s algorithmic stablecoin USDe exploded 177.8% to reach a supply of $9.4 billion, dethroning USDS to become the sector’s third-largest stablecoin. Tether’s USDT maintains its dominance with 61% market share, though this ratio is declining as USDe and USDC expand their footprint.

This fragmentation of the stablecoin market reflects a reality: users now prioritize diversifying counterparty risks. No single actor can any longer embody system-wide stability.

DeFi: the spectacular renaissance of an infrastructure

Decentralized finance recorded one of its strongest comebacks in years, with total value locked (TVL) jumping 40.2%, rising from $115 billion in July to $161 billion by the end of September.

These figures translate into a profound behavioral shift. In 2024, DeFi protocols struggled with margin compression and competition from centralized solutions. Q3 2025 reverses this trend. Why?

Three fundamental reasons:

1. The resurgence of Ethereum (ETH) and L2s. As users seek liquidity and yields, Uniswap, Aave, and Curve pools refill rapidly. Layer 2s (Arbitrum, Optimism, Base) capture substantial volumes thanks to reduced fees.
2. The explosion of perpetual DEXs (perp DEXs). Trading volumes on decentralized perpetual exchanges surged to a quarterly record of $1.8 trillion, with new perp DEXs such as Aster, Lighter, and edgeX emerging as aggressive challengers, often backed by incentive programs that temporarily attracted enormous capital inflows. These rival protocols don’t cannibalize the market; they expand it. Traders arbitrage fees, liquidity, and yields, creating healthy competition.
3. Growing access to on-chain credit. With stablecoins proliferating, borrowing and lending on the blockchain becomes a credible proposition against traditional market interest rates.

Centralized vs. decentralized exchanges: the shift toward on-chain

Spot volumes on centralized CEXs climbed 31.6% quarter-over-quarter to reach $5.1 trillion, with Binance and Bybit in the lead. Binance even extended its market share during the quarter.

However, the truly eye-catching figure lies elsewhere. Binance, OKX and Bybit remain uncontested leaders in spot volumes. But in derivatives and perp liquidity, DEXs are gaining ground. Programmatic incentives (liquidity mining, incentive pools) play a role, but also reveal genuine appetite for permissionless platforms.

For sophisticated traders, this raises a question: how much of this perp DEX volume persists after incentives end? CoinGecko signals this question remains open as we enter Q4. Protocols risk a mechanical correction if liquidity farms dry up.

Bitcoin dominates, Ethereum and BNB climb, altcoins recover

Against this backdrop, Bitcoin (BTC) and Ethereum (ETH) register distinct movements.

Bitcoin, Ethereum, and BNB reached new all-time highs (ATH) in Q3.

BTC consolidates its status as the primary store of value, attracting institutional capital via US spot ETFs.

ETH, despite doubts about its competitiveness versus Solana and others, benefits from the DeFi resurgence and investment ETF inflows.

Speculative altcoins (memecoins, AI tokens) are also reflowering, signaling a return of appetite for risk. This reconvergence of flows across diverse segments suggests growing maturity: investors no longer bet exclusively on Bitcoin.

Institutional flows and market reality: the Q4 equation

The lingering question remains: how much of this growth is structural, and how much is cyclical?

CoinGecko raises this tension explicitly. ETF flows (structural) coexist with liquidity miner incentives and exchange promos (cyclical). This duality will be the key lever in Q4 2025.

If institutional flows via ETFs and new retail entrants dominate spot trading, we’ll see continued maturation. If incentive farms exhaust mercenary capital and perp volumes collapse, a mechanical correction looms.

Practical implications: what changes for you

For retail traders

Liquidity is high and fees are reduced (especially on L2s). However, bid-ask spreads are tightening, rewarding precision and punishing poorly targeted orders.

For DeFi protocols

New entrants capitalize perp DEXs, but long-term profitability hinges on retention. Protocols must evolve from incentive mode to intrinsic value.

For macro investors

Q3 confirms that crypto’s bull cycle is desynchronizing from traditional cycles. Geopolitical tensions, monetary policies, and ETFs now fragment the market into smaller, less-correlated segments.

For regulators

The growth of perp DEXs and alternative stablecoins forces rethinking of existing definitions. USDT, USDC, and USDe are not equivalent on risk grounds, even though they serve similar roles.

The broader context: three quarters of recovery

To contextualize: Q2 2025 had recorded a 24% increase and unprecedented institutional confidence gains, with total capitalization climbing from $2.8 trillion to $3.5 trillion, a $663.6 billion jump.

Q3 extends this dynamic, consolidating rather than surpassing Q2 gains. This reflects maturation: after speculative explosions, the market absorbs new inflows progressively.

Outlook for the remainder of 2025

After the CoinGecko Q2 2025 report, the Q3 2025 report paints a market in transition toward institutionalization, yet not yet freed from funding cycles and incentive dependency. Three consecutive quarters of recovery indicate that fundamentals are consolidating.

The real question: can the market sustain $4 trillion USD without relying on incentives, geopolitical tensions, or exceptional monetary policies?

CoinGecko appears cautious: the data speaks for itself, but interpreting its durability will be the Q4 litmus test.