What Is USDT (Tether)?

USDT, also known as Tether, is the largest stablecoin in crypto: a token designed to hold a steady value of one US dollar. Issued by Tether Limited, it gives traders a way to move in and out of positions without leaving the crypto market for the traditional banking system.

How USDT Holds Its Peg

Each USDT is meant to be backed one-to-one by reserves held by Tether Limited, including cash, cash equivalents, and other assets. When users buy or redeem USDT directly with Tether, tokens are minted or burned so the circulating supply stays in line with those reserves. This backing is what lets USDT trade close to a dollar even when the rest of the market is volatile, though the exact makeup of the reserves has drawn scrutiny over the years.

Where USDT Runs

USDT is a multichain token. It exists as an ERC-20 on Ethereum, an SPL token on Solana, and on networks like Tron and BNB Chain. The version you hold depends on the chain you are transacting on, and moving USDT between chains requires a bridge. On each network it is one of the most liquid assets, widely paired on both centralized exchanges (CEXs) and decentralized exchanges (DEXs).

USDT vs USDC

USDT and USDC are the two dominant dollar stablecoins. USDT has the larger market cap and deeper liquidity across most trading pairs, while USDC is often preferred for its clearer regulatory posture and reserve attestations. Many traders hold both and pick between them based on the exchange, chain, or counterparty involved.

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