Tether

What it is

Tether (USDT) is a stablecoin, a token built to hold the value of one US dollar so that traders can park money or move it between exchanges without waiting on a bank transfer. It launched in July 2014 under the name Realcoin, created by Brock Pierce, Reeve Collins and Craig Sellars, and was renamed Tether later that year. The issuer, Tether Limited, sits in the same corporate group as the Bitfinex exchange. It solved a real problem, dollars that settle at crypto speed, and grew into the most traded token in the market: USDT’s daily trading volume routinely exceeds bitcoin’s, according to CoinGecko data.

How it works

Tether mints new USDT when verified customers deposit dollars and destroys tokens when they redeem, so the supply expands and contracts with demand. If the market price slips away from $1, arbitrage traders buy cheap tokens to redeem at par, or mint at par to sell high, pulling the peg back into line. The company states that every token is backed by reserves, dominated by short-dated US Treasury bills, and it publishes quarterly attestations signed by the accountancy firm BDO. An attestation is a snapshot of the books on a single date rather than a full audit, and no full audit has ever been published. USDT circulates across many blockchains, with Tron and Ethereum long hosting the largest shares according to the company’s own transparency page.

The story so far

Tether spent years dogged by questions about its backing, and two regulators eventually put facts on the record. In February 2021 the New York Attorney General found that Tether had at times operated without full backing, including while covering an $850 million shortfall at a payment processor; the companies paid $18.5 million and were barred from doing business in New York, without admitting wrongdoing. In October 2021 the US Commodity Futures Trading Commission fined Tether $41 million for claiming the token was fully backed “at all times” when it was not. Since then the firm has shifted its reserves heavily into US government debt, reported large quarterly profits in its attestations, and in January 2025 announced the relocation of its headquarters to El Salvador.

Where it stands

As of late July 2026 USDT ranks third among all crypto assets by market value, at about $184 billion (CoinGecko), which makes it the largest stablecoin by a wide margin; it trades within a fraction of a cent of $1. The things to watch are regulatory. The United States passed the GENIUS Act stablecoin framework in July 2025, and how an offshore issuer of Tether’s size fits that regime, along with the long-promised full audit, will shape the token’s next chapter. Its lead has survived every controversy so far; whether it survives regulated competition is the live question for 2026.