What is Tether (USDT)?

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Stablecoins bridge the gap between blockchain-powered digital assets and everyday transactions by eliminating volatility risks inherent in cryptocurrencies like Bitcoin or Ethereum. Tether's USD-backed stablecoin, USDT, leads the market with the highest capitalization, available globally on exchanges and peer-to-peer platforms. As part of the Ledger Ecosystem, USDT is easily managed as an ERC-20 token via Ethereum wallets.


Understanding USDT: A Stablecoin Powerhouse

What is USDT?

USDT is a stablecoin pegged 1:1 to the U.S. dollar, issued by Tether—a centralized entity founded in 2012. With a market cap exceeding $144 billion (as of 2025), USDT dominates 60% of the stablecoin market and ranks as the third-largest crypto asset after BTC and ETH.

Key Features


The Evolution of Tether

Origins

Multi-Chain Expansion

Initially limited to Bitcoin’s Omni protocol, USDT now spans six blockchains, enhancing interoperability and adoption.


Tether vs. USDT: Clarifying the Difference


Why Use USDT?

1. Hedging Against Volatility

Lock in profits during market swings without exiting the crypto ecosystem.

2. Borderless P2P Transfers

Send value globally with low fees, bypassing traditional banking delays.

3. DeFi and dApp Integration

Use USDT for trading, lending, and payments across decentralized platforms like Uniswap or NFT marketplaces.


How USDT Maintains Its Peg

Reserve-Backed Stability

Tether holds reserves exceeding USDT’s circulating supply, comprising:

De-Pegging Risks

In 2022, USDT briefly deviated from $1 due to liquidity imbalances but recovered within 24 hours.


Risks and Mitigations

Centralization Concerns

Counterparty Risk


How to Acquire USDT

1. Buy via On-Ramp Services

Use exchanges like Coinbase (KYC required) to purchase USDT with fiat.

2. Swap Crypto for USDT

Decentralized exchanges (e.g., Uniswap) allow swaps without custody risks.

👉 Buy USDT securely with Ledger Live

3. Ledger Live Integration


FAQ

Is USDT Safe?

Yes, when stored in non-custodial wallets like Ledger. Its value depends on Tether’s reserve management.

Who Owns USDT?

Holders own the tokens; Tether manages issuance and reserves.

How Does Tether Stay at $1?

Through 1:1 reserves and redemption mechanisms.

Is USDT a Good Investment?

Ideal for transactional use, not long-term growth (similar to holding cash).

How to Send/Sell USDT?

👉 Explore USDT with Ledger’s secure devices


Final Thoughts

USDT is a cornerstone of crypto liquidity, offering stability for traders and DeFi users. While centralized control poses risks, Tether’s transparency efforts and multi-chain support solidify its utility.

Ready to dive in? Manage USDT effortlessly with Ledger.