Disclaimer: This page is not financial advice or an endorsement of digital assets, providers or services. Digital assets are volatile and risky, and past performance is no guarantee of future results. Potential regulations or policies can affect their availability and services provided. Talk with a financial professional before making a decision. Finder or the author may own cryptocurrency discussed on this page.
US dollar-backed stablecoins USD Coin (USDC) and Tether (USDT) are the two most widely used stablecoins in the world.
We compare USDC versus USDT on key stats like market capitalization, track record and transparency to help you decide on what’s best for your financial goals.
USDC vs. USDT at a glance
Information last updated April 25, 2024 12:04 UTC.
Coin symbol
USDC
USDT
Market cap
US$33,436,008,139
US$110,445,768,042
Total supply
33,425,260,088
110,463,515,619
Circulating supply
33,422,874,760
110,463,515,619
Current price
US$0.999218
US$0.998485
All-time high
US$1.17
US$1.32
All-time high date
May 08, 2019
July 24, 2018
Notable team members
Jeremy Allaire, Sean Neville, Brian Armstrong
Brock Pierce, Craig Sellars, Reeve Collins
Partnerships
Visa, Ripio
Tron, OMG Network
Industry
Stablecoins
Stablecoins
Token uses
Stablecoin
Stablecoin
Network
Ethereum, Binance Smart Chain, Solana and others
Ethereum, Binance Smart Chain, Solana and others
What are stablecoins and what do people use them for?
Stablecoins are digital tokens that aim to maintain a 1:1 ratio with the value of currencies like the US dollar.
These tokenized dollars can be collateralized — or backed — in many ways. USDT and USDC, the two largest stablecoins by market capitalization, are backed with actual US dollars or other reserve assets like US Treasury bills or commercial bonds.
High-frequency traders often use stablecoins. If traders want to exit a position in an asset like Bitcoin (BTC) but don’t necessarily want to move their money back into a bank account, which often takes days, they can park their money in stablecoins before making their next trade.
Some hold stablecoins to earn a yield on them. Stablecoin holders can earn yields on their stablecoins through centralized finance (CeFi) platforms like BlockFi or through decentralized finance (DeFi) protocols like SushiSwap.
Stablecoins are also used as a currency outside of the United States. People use US dollar-backed stablecoins to pay for goods and services in countries like Argentina, which have dollarized due to high inflation in their national currencies.
Originally called Realcoin, Tether (USDT) was brought to market in July 2014. USDT quickly became used as an alternative to US dollars on crypto exchanges.
Other stablecoins were created in 2014 and 2015, but USDT is the only one from that era that has survived. It’s since become the most widely used stablecoin in the world and the #3 ranked crypto by market cap, according to CoinGecko.
It was created by the Goldman Sachs-backed payment company Circle and is managed by the Centre consortium, which is comprised of Circle and major crypto exchange Coinbase.
In under four years, USDC’s market cap has grown to $56 billion. This makes it the second-most widely used stablecoin in the world and the #4 ranked crypto by market cap according to CoinGecko.
USDC vs. USDT fees
The fees associated with using USDC and USDT are not related to the tokens themselves. Instead, the fees for using these tokens have to do with the blockchain on which you use them.
USDC has earned a good reputation in the crypto space because its parent company, Circle, is more transparent about the assets that back USDC than Tether is with USDT.
USDC
USDT
Audit frequency
Yearly
N/A
Attestation frequency
Monthly
Quarterly
Reserve backing
US dollars, Treasury Bills
US dollars, Treasury Bills, corporate bonds
USDC’s transparency
USDC was created to provide the crypto market with a US dollar-backed stablecoin like USDT but with more transparent backing.
Stablecoin users didn’t trust that USDT was fully collateralized because Tether’s reserves had never been audited. In other words, Tether has been less than forward regarding its finances, and Circle believed that the market needed a stablecoin that investors could trust.
USDC’s reserves have been audited annually by outside accounting firms since the asset’s inception, and the audits from 2020 and 2021 are filed with the SEC.
USDC also undergoes monthly attestations or stress tests in which accounting firms attest to the accuracy of Circle’s financial reports on USDC.
Reports show that USDC is backed only by actual US dollars and US Treasury Bills.
This transparency is important not just for USDC users but also because Circle is preparing to become a publicly-traded company listed on the New York Stock Exchange.
Tether has never been audited nor disclosed the names of the banks in which it keeps its reserves.
Only through an attestation on December 31, 2021, did Tether prove that about 44% of its reserves were in US Treasury Bills. And as of May 2021, only 3% of its reserves were in US dollars.
The rest of its reserves are described as holdings of “unspecified commercial paper,” or short-term debt issued by companies. It’s also added that it doesn’t want to disclose the type of commercial paper it holds because it doesn’t want to give away its “secret sauce.”
New York State sued Tether in April 2019, alleging that it attempted to cover up an $850 million loss.
Bitfinex, a crypto exchange owned by the same company that owns Tether — iFinex — was rumored to have lent Tether money to cover up the losses.
In 2019, the New York Supreme Court found that Tether (USDT) was only 74% backed, and New York State has prohibited Tether from doing business within its borders.
Tether settled the lawsuit by paying a fine of $18.5 million.
Tether still has not been audited and has taken part in only one attestation in the past six months.
Tether has also never issued a full report of what assets compose its reserves, nor in which banks or on which platforms these reserves are kept.
Some fear that Tether poses a systemic risk to crypto markets. For example, professors at the University of Texas found in 2018 that USDT tokens had been minted — without necessarily being properly collateralized — to buy Bitcoin as a means to prop up its price.
Is Tether’s lack of transparency really an issue?
Despite the controversy surrounding USDT, Tether has never failed to process a redemption for an actual US dollar.
If there were a run on Tether, however unlikely, it would mean that not everyone holding USDT tokens would be able to redeem them for actual US dollars.
Bottom line
Whether you’re parking your money in USDT or USDC between trades, lending your stablecoins to generate yield or using them as a medium of exchange, make sure you’ve considered each asset’s track record of transparency and accountability first.
Continue your research on USDC versus USDT by reading our market data overviews on each coin: USD Coin (USDC) and Tether (USDT).
Both USDT and USDC are US dollar-backed stablecoins, but there are some key differences. Take a look at our table above to learn more about the reserves that back each of these assets.
Most of the time, both stablecoins maintain their 1:1 peg to the US dollar. You can compare the current price of USDC versus USDT in our table.
In volatile periods in the market, you might see the price of USDC or USDT rise and fall slightly on either side of one US dollar. In rare cases, the coins have fallen 15-25% from their pegs, but the fluctuations have been relatively short-lived.
Whether products shown are available to you is subject to individual provider sole approval and discretion in accordance with the eligibility criteria and T&Cs on the provider website.
Frank Corva is a cryptocurrency writer and analyst for digital assets at Finder. Frank has turned his hobby of studying and writing about crypto into a career with a mission of educating the world about this burgeoning sector of finance. He worked in Ghana and Venezuela before earning a degree in applied linguistics at Teachers College, Columbia University. He also taught writing and entertainment business courses in Japan and worked with UNICEF in Namibia before returning to the US to teach at universities in New York City. Earlier in his career, he spent years working as a publicist and graphic designer for record labels like Warner Music Group and Triple Crown Records. During that time, he was also a music journalist whose writing and photography was in published in Alternative Press, Spin and other outlets.
Every 3 months, Finder empanels a range of industry specialists to get a pulse on what the future holds for crypto. This is a summary of those findings.
How likely would you be to recommend finder to a friend or colleague?
0
1
2
3
4
5
6
7
8
9
10
Very UnlikelyExtremely Likely
Required
Thank you for your feedback.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
Advertiser Disclosure
finder.com is an independent comparison platform and information service that aims to provide you with the tools you need to make better decisions. While we are independent, the offers that appear on this site are from companies from which finder.com receives compensation. We may receive compensation from our partners for placement of their products or services. We may also receive compensation if you click on certain links posted on our site. While compensation arrangements may affect the order, position or placement of product information, it doesn't influence our assessment of those products. Please don't interpret the order in which products appear on our Site as any endorsement or recommendation from us. finder.com compares a wide range of products, providers and services but we don't provide information on all available products, providers or services. Please appreciate that there may be other options available to you than the products, providers or services covered by our service.
We update our data regularly, but information can change between updates. Confirm details with the provider you're interested in before making a decision.
