USDT Vs USDC:
Which Stablecoin to Choose?
Time to read: 15 min
Stablecoins are digital currencies that aim to hold the same value as a real-world asset and reduce the impact of market price swings. These coins are more reliable than regular cryptocurrencies, store value, and they are usually tied to fiat currencies like the US dollar, the euro, or the Japanese yen.
Today, we focused on two of the most popular fiat-backed stablecoins – USDC and USDT. We explored the main difference between USDC and USDT to help you decide which stablecoin might fit your investment needs best. Let’s find out whether you need to switch from USDC to USDT or vice versa.
What Are Stablecoins?
As mentioned, stablecoins get their name because their value remains steady and they are designed to maintain the price of a specific asset. The base asset can be almost anything – fiat currencies, other cryptocurrencies, or even precious metals. However, fiat-backed stablecoins are the most popular since the finance and crypto market typically measures value in dollars.
Key Types of Stablecoins to Know
Types of stablecoins by governance:
- Centralized
- Decentralized
- Algorithmic
The main types of stablecoins based on what backs them:
- Backed by fiat currencies like the US dollar (Tether (USDT), USD Coin (USDC)) or the euro (EURT). Companies issuing these stablecoins hold funds in bank accounts or with trusted third parties, matching the number of stablecoins in circulation.
- Cryptocurrency-backed stablecoin assets built on the Ethereum network like the Maker DAO.
- Collateralized by precious metals or commodities, such as Tether Gold (XAUt).
- Algorithmic stablecoins, which aren’t backed by any asset. Their value is automatically adjusted based on supply and demand volume. A good example is UST from the Terra project.
Each type of stablecoin has its own unique features and differences. For instance, fiat-backed stablecoins are popular with everyday investors who trade crypto or invest for short and long-term goals. After making a profit, they often move into stablecoins to protect their earnings. On the other hand, tokens fully backed by cryptocurrency are more commonly used by crypto enthusiasts, developers, venture capitalists, and long-term investors.
USDT and USDC: Key Things to Know
USDT and USDC are the two most popular stablecoins in the cryptocurrency ecosystem with their values tied to the US dollar. They’re widely used in the crypto market for trading, investing, storing value, and converting USDC to USDT or vice versa. Let’s take a closer look at both USD-pegged stablecoins to define their main differences.
What Is Tether (USDT)?
- Blockchains supported: Ethereum, TRON, BSC, and 15 more networks
- Type: Fiat-backed stablecoin
- What maintains the value: Reserve assets in bank accounts, stocks, and other assets
- Market cap: $66,096,483,995
- Launch year: 2015
Tether (USDT) is a peer-to-peer blockchain system and an open-source cryptocurrency. It’s considered one of the safest fiat-backed stablecoins in the cryptocurrency ecosystem, with its value tied to the US dollar. Market fluctuations have almost no effect on its rate, although, in 2017, Tether’s price history saw a brief spike of 21%, with the value rising to $1.22. This can happen during strong market volatility, but the value usually stabilizes quickly.
It’s also worth noting that Tether is the most popular stablecoin. Nearly all cryptocurrency platforms and wallets support it as an alternative to traditional methods for depositing and withdrawing funds to a bank account. For users, Tether offers several benefits, like easy transfers between wallets and crypto platforms and a reliable store of value or medium of exchange.
The History of Tether Creation
Tether was designed to provide the crypto market with a stablecoin tied to the US dollar. Its journey began in 2014 when Tether Limited developed the technology to run on the Bitcoin blockchain using the Omni Layer protocol.
The idea was to offer a digital asset with the benefits of cryptocurrencies but without the sharp price swings. Since Tether is always linked to the USD, USDT’s value is highly predictable and remains constant, just as the developers intended.
Tether Limited is responsible for ensuring that USDTs maintain a stable backing by an equal amount of fiat currency or other reserves. They’re required to regularly release reports to confirm these reserves exist, though there’s been some criticism about how transparent they are.
The company also manages and controls coin issuing, ensuring it meets regulatory requirements and follows AML (anti-money laundering) and KYC (know your customer) standards. Like USDC, Tether is centralized and can be frozen or seized if regulators find a user’s actions illegal.
How Does USDT Work?
As mentioned, Tether Limited ensures that tokens maintain a stable backing by reserves, including fiat currency, loans, securities, and other reserve assets. Here’s how the process works:
- A user sends dollars or another fiat currency to Tether Ltd.
- Tether creates the same amount of tokens and transfers them to the user’s wallet.
- The money received is held in reserve to support the value of the tokens.
The process works similarly when redeeming tokens:
- A user sends their tokens to Tether Ltd.
- Tether burns the same number of tokens and sends the user the equivalent amount in dollars (or another fiat currency), charging a small fee.
Tether publishes regular reports on its reserves to keep trust, though there are often concerns about how clear and complete these reports are.
Where to Buy and Store USDT Stablecoin?
You can buy Tether (USDT) on most crypto platforms, both centralized and decentralized. Some popular options include:
- Switchere
- Binance
- Bitfinex
- Kraken
- Uniswap
- Sushiswap
To store Tether, you’ll need a wallet that supports the ERC-20, TRC-20, or other blockchain networks on which USDT stablecoins operate. Popular wallets include:
- Ledger
- Trezor
- Trust Wallet
- Exodus
- MetaMask
- Atomic Wallet
Since the stablecoin is available on several blockchains, users can benefit from lower fees. Visit the official Tether website for a complete list of wallets or platforms that support USDT stablecoins.
Key Advantages and Disadvantages of USDT Stablecoins
Pros
- Value stability
- High liquidity
- Supported by almost all crypto platforms
- Available on multiple blockchains, helping reduce fees
Cons
- Lack of anonymity
- Centralized control
- Unclear reserve transparency
What Is USD Coin (USDC)?
- Blockchains supported: Ethereum, Solana, Avalanche, and 12 more networks
- Type: Fiat-backed stablecoin
- What maintains the value: Equivalent fiat currency in bank accounts
- Market cap: $27,262,310,467
- Launch year: 2018
USD Coin or USDC is a widely used stablecoin in the cryptocurrency ecosystem known for its transparency and liquidity. USDC is issued by Circle in partnership with the crypto platform Coinbase. It’s the second most liquid stablecoin after Tether and is traded on most major platforms.
Circle Ltd. is licensed and regulated by the NYDFS, one of the strictest financial regulators in the U.S. The company has raised significant funding and is well-supported by venture capital. However, it’s worth noting that USDC is a widely centralized stablecoin, meaning it can be frozen or confiscated if regulators determine USD Coin’s use is illegal.
The History of USD Coin Creation
Circle and Centre Consortium launched USD Coin (USDC) to tokenize US dollars for use on public blockchains. Thanks to the open ERC-20 standard, USDC easily integrates with existing services, and more than 100 crypto platforms, wallets, and apps support it.
USDC is the first stablecoin from Centre Consortium, and Circle was the first company that issued it. Their goal is to make transferring fiat currency as simple as browsing the web or sending a message. To ensure transparency and compatibility, Circle helped create Centre, which sets the rules for fiat-backed stablecoins. USDC is based on the principles of openness and accountability, as outlined by the Centre’s standards. To issue USDC, companies must:
- Be licensed to handle money transfers or banking services.
- Pass audits for AML compliance and meet FATF standards.
- Enable USDC token swaps and redemption with other authorized issuers.
- Maintain full reserves for all issued tokens and provide monthly reports verified by independent auditors.
Coinbase also contributed to creating USDC, aiming to build an open financial system for people and businesses worldwide. USD Coin gives users without full access to traditional banking a way to hold digital assets pegged to the US dollar.
How Does USD Crypto Work?
The process of turning the US dollar into USD stablecoins is called tokenization. Circle makes sure that USD Coin remains a fiat-backed stablecoin. There are three steps in tokenization:
- The user transfers the dollar to the issuer’s bank account.
- The issuer creates an equivalent amount of USDC using a smart contract. The token is divisible, so you can create and store as little as 0.000001 USD Coin.
- The newly created USD Coin is transferred to the user, while USDs are held in reserves.
The reverse process works like this:
- The user sends USDC to the issuer’s smart contract address.
- The issuer requests the smart contract to remove the equivalent values of USD Coin from circulation.
- The issuer sends the corresponding amount in USD currency from its reserves to the user’s account minus any applicable fees.
All issuers are required to regularly report their dollar reserves, which are made publicly available.
Where to Buy and Store USDC Stablecoin?
You can buy USD Coin or swap USDC to USDT on many crypto platforms, both CEXs and DEXs, including:
- Switchere
- Binance
- Cex.io
- Uniswap
- Sushiswap
For storing USD Coin, you can use popular wallets like:
- Atomic Wallet
- Coinomi
- Exodus
- imToken
- Trust Wallet
Since USD stablecoin runs on the popular ERC-20 standard, you have plenty of options for working with it. Check out the official website for a full list of digital wallets, DeFi platforms, decentralized finance protocols, and other services.
Key Advantages and Disadvantages of USD Stablecoins
Pros
- Built on the popular Ethereum blockchain
- Available on major crypto platforms
- High liquidity, second only to the USD stablecoin issued by Tether
- Strong regulatory compliance with monthly audits
Cons
- Highly centralized
USDC Vs USDT: Key Similarities to Know
While USDT and USDC cryptocurrencies are two separate fiat-backed stablecoins with a lot of differences, they have several things in common that make USDC and USDT both popular with users.
USDC and USDT: Fiat-Backed Stablecoins
USDT and USDC cryptocurrencies are designed to maintain a 1:1 peg to the US dollar, making them both a reliable medium of exchange and a store of value.
USDT Vs USDC: Centralization
Both USDT and USDC cryptocurrencies are centralized and issued by Tether and Circle companies, which helps them keep their peg to fiat currency. However, this also means stablecoins can be frozen or seized if the issuer determines a user’s actions are illegal.
USDT and USDC: Widely Used Stablecoin
Both USDT and USDC cryptocurrencies are available on most major CEXs and DEXs, offering high liquidity, flexibility, and stable value. They are also supported by many cryptocurrency wallets, giving users plenty of options for storing and managing their USDT or USDC.
Key Difference Between USDT and USDC
While USDT and USDC have a lot in common, there are some key differences to consider. Which one you choose — USDT or USDC — depends on your investment goals. Let’s take a look at the main difference between USDT and USDC cryptocurrencies.
USDC Vs USDT: Issuance and Reserve Assets Backing
- USDT vs USDC: USDT (Tether) reserve assets include fiat currency, loans, and securities. However, the company doesn’t offer much detail about what makes up its reserve storage, which has raised concerns for some users and regulators.
- USDC vs USDT: Unlike Tether, USD Coin issuers are required to hold reserve assets only in cash and short-term government securities. Circle provides monthly audits, increasing trust in USD stablecoins’ stability.
USDC Vs USDT: Transparency Differences
- USDC vs USDT: Although Tether Ltd. regularly claims that USDT is a stablecoin backed by USD, its reserve transparency is often questioned. Reserve details are not always fully disclosed, which creates some risk for investors.
- USDC vs USDT: USD Coin (USDC) is known for its transparency. Circle publishes monthly reports and is committed to meeting financial regulations.
USDC Vs USDT: Liquidity Volume
- USDT vs USDC: USDT is the most liquid and widely used stablecoin, with a higher market cap and trading volume. It’s supported by almost every major cryptocurrency platform.
- USDC vs USDT: Although USDC is the second most liquid fiat-backed stablecoin, its market cap and trading volume are lower. Still, it’s available on most major cryptocurrency platforms.
USDC to USDT: Regulatory Aspects
- USDT and USDC: Despite its popularity, USDT (Tether) faces regulatory scrutiny. Tokens can be frozen or confiscated if the company behind it believes stablecoins used illegally.
- USDC and USDT: Circle operates under strict regulatory oversight and must comply with regulations, which adds credibility to USD Coin. However, tokens can also be frozen if requested by authorities.
USDC to USDT: Difference Table
Key USDC or USDT Difference Metrics USDT (Tether) USDC (USD Coin) Issuer Tether Limited Circle and Coinbase (Centre Consortium) Launch Year 2015 2018 Market Cap $66,096,483,995 $27,262,310,467 Circulating Supply 83 billion 41 billion Daily Trading Volume $50 billion+ $5 billion+ Blockchains Support 20+ networks 15 networks Type Fiat-backed Fiat-backed Stability Mechanism Pegged to USD currency; collateralized by Tether's reserves Pegged to USD currency; collateralized 1:1 with USD in reserves Collateral Type Backed by a mix of assets, including traditional currency, cash equivalents, and other reserves Fully backed by cash and short-term U.S. Treasury bonds Liquidity Highest among stablecoins Second-highest Regulatory Compliance Less regulated, facing some scrutiny Fully complies with U.S. regulations Centralization Centralized, can freeze digital assets Centralized, can freeze digital assets Reserve Audits Reserve reports are published quarterly but criticized for lack of detail Monthly reserve audits by certified auditors Transparency Limited, periodic reports on the reserve of assets published quarterly Monthly audits, highly transparent Main Use Cases Trading, arbitrage, payments, cross-exchange transfers, decentralized finance protocols Trading, arbitrage, payments, cross-chain transfers, decentralized finance protocols Supported Wallets Supported by 100+ wallets Supported by 100+ wallets Supported Exchanges Listed on 200+ exchanges Listed on 150+ exchanges
Conclusion
We have explored the main differences between two of the most popular digital tokens with a stable value — USDT (Tether) and USDC — to help you make an informed decision. Both tokens maintain a stable rate and serve as a reliable medium of exchange due to their peg to the dollar, making them appealing to many users in the crypto ecosystem. Ultimately, whether you need to switch from USDC to USDT or vice versa depends on your individual needs and priorities.
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Stablecoins are digital currencies that aim to hold the same value as a real-world asset and reduce the impact of market price swings. These coins are more reliable than regular cryptocurrencies, store value, and they are usually tied to fiat currencies like the US dollar, the euro, or the Japanese yen.
Today, we focused on two of the most popular fiat-backed stablecoins – USDC and USDT. We explored the main difference between USDC and USDT to help you decide which stablecoin might fit your investment needs best. Let’s find out whether you need to switch from USDC to USDT or vice versa.
What Are Stablecoins?
As mentioned, stablecoins get their name because their value remains steady and they are designed to maintain the price of a specific asset. The base asset can be almost anything – fiat currencies, other cryptocurrencies, or even precious metals. However, fiat-backed stablecoins are the most popular since the finance and crypto market typically measures value in dollars.
Key Types of Stablecoins to Know
Types of stablecoins by governance:
- Centralized
- Decentralized
- Algorithmic
The main types of stablecoins based on what backs them:
- Backed by fiat currencies like the US dollar (Tether (USDT), USD Coin (USDC)) or the euro (EURT). Companies issuing these stablecoins hold funds in bank accounts or with trusted third parties, matching the number of stablecoins in circulation.
- Cryptocurrency-backed stablecoin assets built on the Ethereum network like the Maker DAO.
- Collateralized by precious metals or commodities, such as Tether Gold (XAUt).
- Algorithmic stablecoins, which aren’t backed by any asset. Their value is automatically adjusted based on supply and demand volume. A good example is UST from the Terra project.
Each type of stablecoin has its own unique features and differences. For instance, fiat-backed stablecoins are popular with everyday investors who trade crypto or invest for short and long-term goals. After making a profit, they often move into stablecoins to protect their earnings. On the other hand, tokens fully backed by cryptocurrency are more commonly used by crypto enthusiasts, developers, venture capitalists, and long-term investors.
USDT and USDC: Key Things to Know
USDT and USDC are the two most popular stablecoins in the cryptocurrency ecosystem with their values tied to the US dollar. They’re widely used in the crypto market for trading, investing, storing value, and converting USDC to USDT or vice versa. Let’s take a closer look at both USD-pegged stablecoins to define their main differences.
What Is Tether (USDT)?
- Blockchains supported: Ethereum, TRON, BSC, and 15 more networks
- Type: Fiat-backed stablecoin
- What maintains the value: Reserve assets in bank accounts, stocks, and other assets
- Market cap: $66,096,483,995
- Launch year: 2015
Tether (USDT) is a peer-to-peer blockchain system and an open-source cryptocurrency. It’s considered one of the safest fiat-backed stablecoins in the cryptocurrency ecosystem, with its value tied to the US dollar. Market fluctuations have almost no effect on its rate, although, in 2017, Tether’s price history saw a brief spike of 21%, with the value rising to $1.22. This can happen during strong market volatility, but the value usually stabilizes quickly.
It’s also worth noting that Tether is the most popular stablecoin. Nearly all cryptocurrency platforms and wallets support it as an alternative to traditional methods for depositing and withdrawing funds to a bank account. For users, Tether offers several benefits, like easy transfers between wallets and crypto platforms and a reliable store of value or medium of exchange.
The History of Tether Creation
Tether was designed to provide the crypto market with a stablecoin tied to the US dollar. Its journey began in 2014 when Tether Limited developed the technology to run on the Bitcoin blockchain using the Omni Layer protocol.
The idea was to offer a digital asset with the benefits of cryptocurrencies but without the sharp price swings. Since Tether is always linked to the USD, USDT’s value is highly predictable and remains constant, just as the developers intended.
Tether Limited is responsible for ensuring that USDTs maintain a stable backing by an equal amount of fiat currency or other reserves. They’re required to regularly release reports to confirm these reserves exist, though there’s been some criticism about how transparent they are.
The company also manages and controls coin issuing, ensuring it meets regulatory requirements and follows AML (anti-money laundering) and KYC (know your customer) standards. Like USDC, Tether is centralized and can be frozen or seized if regulators find a user’s actions illegal.
How Does USDT Work?
As mentioned, Tether Limited ensures that tokens maintain a stable backing by reserves, including fiat currency, loans, securities, and other reserve assets. Here’s how the process works:
- A user sends dollars or another fiat currency to Tether Ltd.
- Tether creates the same amount of tokens and transfers them to the user’s wallet.
- The money received is held in reserve to support the value of the tokens.
The process works similarly when redeeming tokens:
- A user sends their tokens to Tether Ltd.
- Tether burns the same number of tokens and sends the user the equivalent amount in dollars (or another fiat currency), charging a small fee.
Tether publishes regular reports on its reserves to keep trust, though there are often concerns about how clear and complete these reports are.
Where to Buy and Store USDT Stablecoin?
You can buy Tether (USDT) on most crypto platforms, both centralized and decentralized. Some popular options include:
- Switchere
- Binance
- Bitfinex
- Kraken
- Uniswap
- Sushiswap
To store Tether, you’ll need a wallet that supports the ERC-20, TRC-20, or other blockchain networks on which USDT stablecoins operate. Popular wallets include:
- Ledger
- Trezor
- Trust Wallet
- Exodus
- MetaMask
- Atomic Wallet
Since the stablecoin is available on several blockchains, users can benefit from lower fees. Visit the official Tether website for a complete list of wallets or platforms that support USDT stablecoins.
Key Advantages and Disadvantages of USDT Stablecoins
Pros
- Value stability
- High liquidity
- Supported by almost all crypto platforms
- Available on multiple blockchains, helping reduce fees
Cons
- Lack of anonymity
- Centralized control
- Unclear reserve transparency
What Is USD Coin (USDC)?
- Blockchains supported: Ethereum, Solana, Avalanche, and 12 more networks
- Type: Fiat-backed stablecoin
- What maintains the value: Equivalent fiat currency in bank accounts
- Market cap: $27,262,310,467
- Launch year: 2018
USD Coin or USDC is a widely used stablecoin in the cryptocurrency ecosystem known for its transparency and liquidity. USDC is issued by Circle in partnership with the crypto platform Coinbase. It’s the second most liquid stablecoin after Tether and is traded on most major platforms.
Circle Ltd. is licensed and regulated by the NYDFS, one of the strictest financial regulators in the U.S. The company has raised significant funding and is well-supported by venture capital. However, it’s worth noting that USDC is a widely centralized stablecoin, meaning it can be frozen or confiscated if regulators determine USD Coin’s use is illegal.
The History of USD Coin Creation
Circle and Centre Consortium launched USD Coin (USDC) to tokenize US dollars for use on public blockchains. Thanks to the open ERC-20 standard, USDC easily integrates with existing services, and more than 100 crypto platforms, wallets, and apps support it.
USDC is the first stablecoin from Centre Consortium, and Circle was the first company that issued it. Their goal is to make transferring fiat currency as simple as browsing the web or sending a message. To ensure transparency and compatibility, Circle helped create Centre, which sets the rules for fiat-backed stablecoins. USDC is based on the principles of openness and accountability, as outlined by the Centre’s standards. To issue USDC, companies must:
- Be licensed to handle money transfers or banking services.
- Pass audits for AML compliance and meet FATF standards.
- Enable USDC token swaps and redemption with other authorized issuers.
- Maintain full reserves for all issued tokens and provide monthly reports verified by independent auditors.
Coinbase also contributed to creating USDC, aiming to build an open financial system for people and businesses worldwide. USD Coin gives users without full access to traditional banking a way to hold digital assets pegged to the US dollar.
How Does USD Crypto Work?
The process of turning the US dollar into USD stablecoins is called tokenization. Circle makes sure that USD Coin remains a fiat-backed stablecoin. There are three steps in tokenization:
- The user transfers the dollar to the issuer’s bank account.
- The issuer creates an equivalent amount of USDC using a smart contract. The token is divisible, so you can create and store as little as 0.000001 USD Coin.
- The newly created USD Coin is transferred to the user, while USDs are held in reserves.
The reverse process works like this:
- The user sends USDC to the issuer’s smart contract address.
- The issuer requests the smart contract to remove the equivalent values of USD Coin from circulation.
- The issuer sends the corresponding amount in USD currency from its reserves to the user’s account minus any applicable fees.
All issuers are required to regularly report their dollar reserves, which are made publicly available.
Where to Buy and Store USDC Stablecoin?
You can buy USD Coin or swap USDC to USDT on many crypto platforms, both CEXs and DEXs, including:
- Switchere
- Binance
- Cex.io
- Uniswap
- Sushiswap
For storing USD Coin, you can use popular wallets like:
- Atomic Wallet
- Coinomi
- Exodus
- imToken
- Trust Wallet
Since USD stablecoin runs on the popular ERC-20 standard, you have plenty of options for working with it. Check out the official website for a full list of digital wallets, DeFi platforms, decentralized finance protocols, and other services.
Key Advantages and Disadvantages of USD Stablecoins
Pros
- Built on the popular Ethereum blockchain
- Available on major crypto platforms
- High liquidity, second only to the USD stablecoin issued by Tether
- Strong regulatory compliance with monthly audits
Cons
- Highly centralized
USDC Vs USDT: Key Similarities to Know
While USDT and USDC cryptocurrencies are two separate fiat-backed stablecoins with a lot of differences, they have several things in common that make USDC and USDT both popular with users.
USDC and USDT: Fiat-Backed Stablecoins
USDT and USDC cryptocurrencies are designed to maintain a 1:1 peg to the US dollar, making them both a reliable medium of exchange and a store of value.
USDT Vs USDC: Centralization
Both USDT and USDC cryptocurrencies are centralized and issued by Tether and Circle companies, which helps them keep their peg to fiat currency. However, this also means stablecoins can be frozen or seized if the issuer determines a user’s actions are illegal.
USDT and USDC: Widely Used Stablecoin
Both USDT and USDC cryptocurrencies are available on most major CEXs and DEXs, offering high liquidity, flexibility, and stable value. They are also supported by many cryptocurrency wallets, giving users plenty of options for storing and managing their USDT or USDC.
Key Difference Between USDT and USDC
While USDT and USDC have a lot in common, there are some key differences to consider. Which one you choose — USDT or USDC — depends on your investment goals. Let’s take a look at the main difference between USDT and USDC cryptocurrencies.
USDC Vs USDT: Issuance and Reserve Assets Backing
- USDT vs USDC: USDT (Tether) reserve assets include fiat currency, loans, and securities. However, the company doesn’t offer much detail about what makes up its reserve storage, which has raised concerns for some users and regulators.
- USDC vs USDT: Unlike Tether, USD Coin issuers are required to hold reserve assets only in cash and short-term government securities. Circle provides monthly audits, increasing trust in USD stablecoins’ stability.
USDC Vs USDT: Transparency Differences
- USDC vs USDT: Although Tether Ltd. regularly claims that USDT is a stablecoin backed by USD, its reserve transparency is often questioned. Reserve details are not always fully disclosed, which creates some risk for investors.
- USDC vs USDT: USD Coin (USDC) is known for its transparency. Circle publishes monthly reports and is committed to meeting financial regulations.
USDC Vs USDT: Liquidity Volume
- USDT vs USDC: USDT is the most liquid and widely used stablecoin, with a higher market cap and trading volume. It’s supported by almost every major cryptocurrency platform.
- USDC vs USDT: Although USDC is the second most liquid fiat-backed stablecoin, its market cap and trading volume are lower. Still, it’s available on most major cryptocurrency platforms.
USDC to USDT: Regulatory Aspects
- USDT and USDC: Despite its popularity, USDT (Tether) faces regulatory scrutiny. Tokens can be frozen or confiscated if the company behind it believes stablecoins used illegally.
- USDC and USDT: Circle operates under strict regulatory oversight and must comply with regulations, which adds credibility to USD Coin. However, tokens can also be frozen if requested by authorities.
USDC to USDT: Difference Table
| Key USDC or USDT Difference Metrics | USDT (Tether) | USDC (USD Coin) |
| Issuer | Tether Limited | Circle and Coinbase (Centre Consortium) |
| Launch Year | 2015 | 2018 |
| Market Cap | $66,096,483,995 | $27,262,310,467 |
| Circulating Supply | 83 billion | 41 billion |
| Daily Trading Volume | $50 billion+ | $5 billion+ |
| Blockchains Support | 20+ networks | 15 networks |
| Type | Fiat-backed | Fiat-backed |
| Stability Mechanism | Pegged to USD currency; collateralized by Tether's reserves | Pegged to USD currency; collateralized 1:1 with USD in reserves |
| Collateral Type | Backed by a mix of assets, including traditional currency, cash equivalents, and other reserves | Fully backed by cash and short-term U.S. Treasury bonds |
| Liquidity | Highest among stablecoins | Second-highest |
| Regulatory Compliance | Less regulated, facing some scrutiny | Fully complies with U.S. regulations |
| Centralization | Centralized, can freeze digital assets | Centralized, can freeze digital assets |
| Reserve Audits | Reserve reports are published quarterly but criticized for lack of detail | Monthly reserve audits by certified auditors |
| Transparency | Limited, periodic reports on the reserve of assets published quarterly | Monthly audits, highly transparent |
| Main Use Cases | Trading, arbitrage, payments, cross-exchange transfers, decentralized finance protocols | Trading, arbitrage, payments, cross-chain transfers, decentralized finance protocols |
| Supported Wallets | Supported by 100+ wallets | Supported by 100+ wallets |
| Supported Exchanges | Listed on 200+ exchanges | Listed on 150+ exchanges |
Conclusion
We have explored the main differences between two of the most popular digital tokens with a stable value — USDT (Tether) and USDC — to help you make an informed decision. Both tokens maintain a stable rate and serve as a reliable medium of exchange due to their peg to the dollar, making them appealing to many users in the crypto ecosystem. Ultimately, whether you need to switch from USDC to USDT or vice versa depends on your individual needs and priorities.
FAQ
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