USDC vs. USDT: Which Stablecoin is a Better Choice in 2024?

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In the dynamic landscape of cryptocurrencies, stablecoins play a crucial role in bridging traditional and decentralized finance

Two prominent players in the stablecoin industry are Tether USD (USDT) and USD Coin (USDC). USDT is the oldest and largest stablecoin globally, while USDC brands itself as a safe, regulated, and compliant stablecoin.

What are the key differences between USDT and USDC? Learn which stablecoin suits you best in this USDC vs USDT comparison article.

Key Takeaways

  • USDT is the world’s oldest and largest stablecoin with a market capitalization of over $95 billion.
  • USDC is the world’s second-largest stablecoin, founded in 2018 by Circle and Coinbase.
  • USDT and USDC have a combined market cap of over $1.2 trillion.
  • USDT was sued by the Commodity Futures Trading Commission (CFTC) in 2017 for not fully backing its stablecoins reserves.  
  • A US stablecoin law called The Clarity for Payment Stablecoins Act is pending approval in the House of Representatives.

What is USDT?

Tether USD, or USDT, is a US dollar-pegged cryptocurrency issued by Tether Limited. USDT is the world’s oldest and largest stablecoin with a market capitalization of over $95 billion as of January 2024.


USDT is a stablecoin pegged to a real-world fiat currency, the US dollar, on a 1-to-1 basis. 

According to issuer Tether, all USDT tokens are backed 100% by US dollar reserves in the form of US treasury bills, overnight reverse repurchase agreements, money market funds, corporate bonds, precious metals, Bitcoin (BTC), secured loans, and cash.

USDT is available on popular blockchain networks, including Ethereum (ETH), Tron (TRX), Solana (SOL), Avalanche (AVAX), Cosmos (ATOM), and Tezos (XTZ).

What is USDC?

USD Coin, or USDC, is a US dollar-pegged cryptocurrency. USDC is the world’s second-largest stablecoin with a market capitalization of over $25 billion as of January 2024.

USDC was launched in 2018 by a consortium called Centre, which was founded by Circle and Coinbase. In 2023, Circle absorbed the Centre consortium and became the sole issuer of USDC. Coinbase took an undisclosed equity stake in Circle as a part of the deal.

Circle and Coinbase launched USDC at a time when CFTC charged USDT issuer Tether for not fully backing its stablecoins with US dollar reserves, as Tether had previously stated. 

USDC branded itself as the safest stablecoin in the market with regulated and fully backed reserves. Circle promotes transparency by disclosing attested reports of USDC reserve holdings every week.

USDT vs USDC Comparison: Which Stablecoin is Better?

What’s the difference between USDC and USDT? Is USDC safer than USDT? Let’s compare the two stablecoins regarding redemptions, transparency, availability, and depegging incidents.


Tether said all USDT tokens are backed 100% by reserves.  Circle said all USDC tokens are backed 100% by highly liquid cash and cash-equivalent assets.
According to Tether, the value of Tether’s reserves is published daily and updated at least once per day on their official website. Daily accounts of Circle’s reserves are available on BlackRock’s website.
An independent auditor report on Tether’s reserves is published quarterly.  An independent auditor report on Circle’s reserves is published monthly. 
BDO Italia is Tether’s independent auditor. Deloitte is Circle’s independent auditor.
According to a September 2023 audit report, 85.7% of Tether’s stablecoin is backed by cash, cash equivalents, and other short-term deposits. Rest is held in corporate bonds, precious metals, Bitcoins, secured loans, and other investments. According to BlackRock, Circle’s reserve fund held 67.3% of total funds in US Treasury repurchase agreements and 32.6% in US Treasury Debt as of 24 January 2024.


According to Tether, USDT can be redeemed by depositing USDT tokens to and receiving fiat currency into a verified bank account. Circle offers USDC minting and redeeming only to businesses and institutional customers.
Minimum redemption amount via is $100,000. Redemptions over $1,000 incur a 0.1% fee. USDC minting and redeeming for retail customers was stopped in November 2023.
Customers are required to follow know your customer (KYC), anti-money laundering (AML), and counter-terrorist financing (CTF) compliances. USDC is available to retail customers via crypto exchanges, brokerages, and wallet services.
Users can exchange USDT for fiat currencies and other cryptocurrencies on centralized exchanges such as Binance, Coinbase, and more. Users can exchange USDC for fiat currencies and other cryptocurrencies on centralized exchanges such as Binance, Coinbase, and more.


USDT is natively available on the following blockchains:

  1. Tron
  2. Ethereum
  3. Solana
  4. Avalanche
  5. Cosmos
  6. Tezos
  7. EOS
  8. Liquid
  9. Algorand
  10. Polkadot
  11. Near
USDC is natively available on the following blockchains:

  1. Ethereum
  2. Algorand
  3. Arbitrum
  4. Avalanche
  5. Base
  6. Flow
  7. Hedera
  8. Near
  9. Noble
  10. Optimism
  11. Polkadot
  12. Polygon POS
  13. Solana
  14. Stellar
  15. Tron

Depegging Incidents of USDT and USDC

Both USDT and USDC stablecoins have experienced several instances of depegging. 

Most recently, USDC briefly fell below 74 cents on the Binance crypto exchange in January 2024 on fears that market regulators might reject the spot bitcoin ETF. On another occasion, USDC fell as low as 86 cents in April 2023 after Circle announced that $3.3 billion, or 8% of total funds backing USDC, were in the now-collapsed Silicon Valley Bank.

As for USDT, the stablecoin is no stranger to depegging events. In August 2023, USDT experienced depegging events all month, falling about 2% in most trading platforms, following reports that over $500 million of USDT occurred on major centralized and decentralized crypto exchanges. 

In November 2022, USDT depegged to a low of $0.9755 on reports that FTX and Alameda Research were selling stablecoins to save themselves from collapse.

USDC vs USDT: How to Choose the Right Stablecoin?

Here are key points to keep in mind when choosing the right stablecoin for you:

  • Is the stablecoin listed with your brokerage or crypto exchange?
  • Is the stablecoin available on the blockchain network you want to use?
  • How transparent is the stablecoin issuer with its reserves?
  • Is the stablecoin backed by fiat currency reserves?
  • What type of financial instruments make up the stablecoin reserves?
  • Is the stablecoin issuer compliant with regional laws and regulations?

You can also apply the SMIDGE rating framework, used by the Bluechip stablecoin rating agency, to assess the most suitable stablecoin option.

The SMIDGE Stablecoin Framework explained

As of January 2024, Bluechip’s rating for USD Coin was much higher than Tether’s. The agency assessed USDC as B+ while giving USDT a D grade.

Stablecoin Regulation

As of January 2024, there is no federal regulatory framework for stablecoins in the US. 

The rapid growth of stablecoins has alarmed regulatory bodies such as the US Securities and Exchange Commission (SEC) and CFTC due to the “systematic risk” the trillion-dollar stablecoin industry potentially poses to the global financial system. 

However, there is uncertainty as to which federal body will end up regulating stablecoins in the US. The SEC and the CFTC are both keen on regulating cryptocurrencies and have argued over whether cryptocurrencies should be regulated as securities or commodities.

2024 could be the year that we finally see a comprehensive regulatory framework in the US for cryptocurrencies and stablecoins.

Circle CEO Jeremy Allaire agrees. Speaking at the World Economic Forum in January 2024, Allaire said that the Clarity for Payment Stablecoins Act, which aims to regulate stablecoins like traditional financial services, had a “very good chance” of being passed this year.

“You’re seeing progress on stablecoin legislation. Stablecoin laws are going to be on the books in almost every major global financial market in 2024,” Allaire said.

The Clarity for Payment Stablecoins Act is currently pending approval in the House of Representatives. If the bill is passed, the legislation will create a regulatory framework for issuing and overseeing stablecoins.

The Bottom Line

When choosing between USDT and USDC, users must consider critical factors like availability, transparency, and stability. 

With so many stablecoins available today, it is essential for cryptocurrency users to conduct due diligence and take some time out to assess their stablecoin options.


Is USDC equal to USDT?

Is USDC safe now?

Which is the safest stablecoin?


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Mensholong Lepcha
Crypto & Blockchain Writer
Mensholong Lepcha
Crypto & Blockchain Writer

Mensholong is an experienced crypto and blockchain journalist, now a full-time writer at Techopedia. He has previously contributed news coverage and in-depth market analysis to, StockTwits, XBO, and other publications. He started his writing career at Reuters in 2017, covering global equity markets. In his free time, Mensholong loves watching football, finding new music, and buying BTC and ETH for his crypto portfolio.