What is a Stablecoin?
A stablecoin is a cryptocurrency designed to maintain stable value, typically pegged to a stable asset (like the US dollar, gold, or others), avoiding the volatility of Bitcoin while offering free trading, censorship resistance, and more.
The King of Stablecoins: The History of USDT
2014, a dimly lit apartment in New York
Brock Pierce pushed his laptop to the center of the table, screen showing Omni Layer code. “We’re building something,” he said, “to use dollars on the blockchain—without asking banks.” Reeve Collins nodded, Craig Sellars hit Enter. That moment, Realcoin was born—a “digital dollar” on Bitcoin. Weeks later, they renamed it: Tether, or USDT. The first 10,000 USDT appeared on-chain like ghosts, claiming: “Backed by $10,000 in cash, redeemable anytime.”
2015–2016: The “Safe Haven” of Underground Exchanges
Exchange owners acted like they’d found treasure. “Bitcoin soars to the moon, crashes to hell—users need an anchor that never dies.” USDT started bouncing in order books on Bitfinex and Poloniex. Some used it for arbitrage, others to escape market tops. It became an invisible blood vessel connecting fiat and crypto worlds. No one asked where the reserves were—as long as the price was 1.0000, it was enough.
2017: The “Money Printer” of the Bull Market
Bitcoin surged toward $20,000, and USDT’s mint button glowed red-hot. “More USDT needed!” exchanges shouted. Tether acted like a turbocharged central bank, minting billions in days. Market cap rocketed from $10 million to $1 billion. They moved USDT to Ethereum (ERC-20)—transfers went from “wait an hour” to “instant.” On-chain users cheered: “Finally, a coin that won’t bankrupt me overnight!”
2025: USDT total reserves reach $120 billion, daily trading volume exceeds $80 billion, over 100 million wallets hold USDT—firmly seated on the stablecoin throne.
Is Digital Stablecoin Reliable? How Does It Stay Stable?
Tether issues USDT with 1:1 USD backing. To mint $1, $1 must be deposited in Tether’s bank. Burning 1 USDT returns $1 to the user—this is Tether’s only “hard anchor” from $0 to $120 billion in 11 years.
USDT Issuance Process (2025 Latest)
Fiat Deposit → Tether Bank Account (USD/EUR)
KYC/AML Review → Notify Treasury upon approval
On-chain Mint → Mint equal USDT on target chain (ERC-20/TRC-20 etc.)
Real-time Disclosure → <https://tether.to/transparency> updated every 5 minutes
Redemption (Reverse) → User submits USDT → Treasury burns → Bank transfers USD
Plus on-chain arbitrage bots, liquidity pools, and more—ensuring USDT always maintains 1:1 peg.
