USDT vs USDC: what are Tether and USD Coin?

USDT and USDC are the two largest stablecoins, tokens designed to stay worth one US dollar. USDT, usually called Tether, is issued by a company of the same name. USDC, originally USD Coin, is issued by Circle. They do the same job but differ in who stands behind them, what is held in reserve and which regulators oversee them.

Who issues them?

Tether launched in 2014 and is the older and more heavily traded of the two. It is privately held and does not publish the filings a listed company must.

USDC launched in 2018 as a joint project of Circle and the exchange Coinbase. Circle has been the sole issuer since 2023 and listed its shares on the New York Stock Exchange in June 2025, so it files regular financial reports with the SEC.

What backs each coin?

Circle says most USDC reserves sit in the Circle Reserve Fund, a government money market fund managed by BlackRock that holds cash, short-dated Treasuries and overnight repurchase agreements. The rest is cash at banks. A Big Four accounting firm issues a monthly assurance report on the reserves.

Tether says USDT is fully backed, mostly by US Treasuries, with other holdings that include gold. Its record is more contested. In October 2021, the CFTC fined Tether $41 million, finding that it held enough cash-type reserves to back its tokens on only 27.6% of days in a 26-month period from 2016 to 2018. For years Tether published quarterly attestations, which are snapshots of holdings on one date, in place of a full audit. In August 2026, the company said KPMG had completed an audit of its 2025 financial statements and given an unqualified opinion.

USDC briefly traded below $1 in March 2023 after the failure of Silicon Valley Bank, where part of its reserves was held.

How are they regulated?

In the United States, the GENIUS Act, signed in July 2025, sets reserve and disclosure standards for dollar stablecoin issuers. Agencies were still writing the detailed rules as of October 2026. Circle received final approval from the OCC in July 2026 to open a national trust bank. Tether launched a separate US-focused token, USAT, in January 2026, issued through the federally chartered Anchorage Digital Bank.

In the European Union, Circle has been authorized under MiCA since 2024. Tether did not seek authorization. After the EU markets regulator told firms in January 2025 to restrict non-compliant stablecoins, EU-regulated exchanges removed USDT.

Where is each one used?

USDT dominates trading on exchanges outside the United States and is widely used for everyday dollar transfers in emerging markets. USDC is more common on US-regulated platforms, with payment companies and in DeFi apps.

Both run as tokens on many blockchains, and both issuers can freeze tokens at a given address, typically at the request of law enforcement. Neither is a bank deposit, and neither carries deposit insurance.