Source publication: August 18, 2026, at 12:44 UTC+8. Based on Galaxy research by Zack Pokorny, translated into Chinese by Saoirse of Foresight News and published by PANews.
Stablecoin borrowing became more expensive even as crypto-backed lending contracted in the second quarter of 2026, according to Galaxy’s review. The report tracked both stablecoins borrowed through lending protocols and the cost of minting stablecoins against crypto collateral—two funding routes with different mechanisms.
Across centralized lenders, decentralized lending applications and the crypto-backed portion of collateralized debt position (CDP) stablecoins, outstanding lending fell by $11.33 billion, or 16.78%, to $56.16 billion during the quarter. All three categories contracted together for the first time since the fourth quarter of 2022.
Stablecoin funding costs moved higher
Galaxy’s weighted-average stablecoin borrowing-cost measure rose by 27 basis points between March 31 and June 30, using a seven-day moving average. It continued rising after quarter-end, reaching 3.88%.
The measure combines borrowing costs on lending protocols with CDP stablecoin minting fees, weighted by outstanding borrowing. It is a funding-cost measure, not a measure of stablecoin reserve returns or redemption terms.
Galaxy found that protocol borrowing rates and CDP minting rates moved broadly together. CDP rates were less volatile because they were set manually at intervals rather than adjusting continuously with market conditions. The report described the U.S. federal funds rate as a floor for both series over more than 21 months.
In the over-the-counter market:
- USDC borrowing rates ranged from 4.25% to 5% during the quarter. The quarter-end rate of 4.25% remained in place through August 3.
- USDT borrowing rates also ranged from 4.25% to 5%.
These OTC figures describe a separate lending market from the on-chain weighted-average measure.
CDP borrowing shrank, while Tether remained the largest tracked centralized lender
The crypto-backed portion of CDP stablecoins declined by $1.09 billion, or 7.86%, during the quarter. It represented 22.7% of the report’s total crypto-backed lending market at June 30.
Centralized finance, or CeFi, lenders had $22.98 billion in outstanding crypto-backed loans, down $2.45 billion, or 9.62%, from the previous quarter. Galaxy attributed most of that contraction to a decline in Tether’s outstanding secured loans. Galaxy, Coinbase, Ledn, Arch, Sygnum and Milo nevertheless recorded loan-book growth.
Tether remained the largest lender in the tracked CeFi sample, with 58.54% market share, down 371 basis points quarter over quarter. Maple held 8.91% and Nexo 7.51%; together, the three accounted for 74.96% of the sample.
These figures concern lending books. They do not, by themselves, establish reserve adequacy or redemption availability. Galaxy also cautioned that lenders differ in accepted collateral, customer eligibility, loan currency and jurisdiction, limiting direct comparisons.
DeFi contracted faster—and the totals can overlap
Outstanding loans on DeFi lending applications fell for a third consecutive quarter, declining $7.79 billion, or 27.61%, to $20.43 billion. CeFi lending consequently exceeded DeFi application borrowing for the first time since the third quarter of 2023.
At quarter-end, the broader crypto-backed lending market was divided as follows:
| Segment | Share |
|---|---|
| CeFi lending platforms | 40.93% |
| DeFi lending applications | 36.37% |
| Crypto-backed portion of CDP stablecoins | 22.70% |
Galaxy warned that adding these categories can double-count borrowing. A centralized lender might pledge BTC in a DeFi protocol, borrow USDC and lend that USDC to an off-chain customer. The funding can then appear in both the protocol’s outstanding borrowing and the lender’s customer loan book. Minting CDP stablecoins to fund off-chain loans creates a similar overlap.
Limited disclosures and incomplete identification of on-chain participants make those overlaps difficult to remove. Galaxy also noted inconsistent CeFi accounting and disclosure schedules, and said data supplied by private third parties had not been formally verified by its research team.
USDT and USDC accounted for about half of sampled Aave debt
A separate August 7, 2026 snapshot of Aave V3’s core market showed USDT representing approximately 28% of outstanding debt and USDC approximately 22%. WETH accounted for slightly more than 37%.
The filtered sample contained 19,073 outstanding loans. Galaxy applied a $100 minimum-debt threshold and additional health-factor and positive-equity rules for its risk statistics, so the results should not be read as an unfiltered account of every position.
Efficiency-mode positions represented only 8.91% of loans by count but approximately half of outstanding debt. Their debt-weighted loan-to-value ratio was about 90%, with a health factor of 1.06, compared with roughly 49% and 1.79 for ordinary-mode positions. Galaxy linked much of efficiency-mode borrowing to leveraged ETH staking strategies rather than stablecoin borrowing alone.
Galaxy’s interpretation: gradual deleveraging, not proof of safety
Galaxy characterized the broader contraction as a more orderly reduction in leverage than the sharp declines of 2022. It interpreted the pattern as gradual risk reduction rather than widespread forced liquidation or counterparty failures.
That remains the report’s assessment, not a guarantee against further stress. Its post-quarter observations also used different dates: DeFi borrowing stood at $21.94 billion on July 21, while futures open interest recovered to approximately $114 billion by the end of July. Galaxy suggested borrowing and futures activity might have been approaching a bottom, but framed that conclusion conditionally.