Cryptocurrency

USDT vs USDC: Difference between Top Stablecoins

USDT vs USDC

What is Tether (USDT)?

The prices of popular crypto such as Bitcoin and Ethereum have changed over time. As the ROI of these assets climbed high, the risks associated with these tokens also surged. This is when the concept of stablecoin emerged, with Tether(USDT) being the leader of all. USDT is a stablecoin, pegged to the US dollar and backed 100% by Tether Reserves, as per their official website. 

It was founded by a Hong Kong-based company called iFinex, which also owns a crypto exchange, Bitfiniex. USDT worked on the Bitcoin blockchain during its inception and soon expanded its reach to other chains like Ethereum, Tron, Solana, OMG Network, etc. Presently, Tether is the third largest crypto asset after Bitcoin and Ethereum according to the market cap and the largest stablecoin in the crypto space. 

Additional Read: Tether(USDT) Whitepaper Summary

Latest News on Tether 

  • Tether is constantly expanding its reach and recently announced its presence on the Polkadot blockchain

  • A US Judge in New York has ordered Tether to produce financial records to support the claim relating to USDT backing. 

What is a USD Coin (USDC)?

Similar to USDT, the USD coin is also a crypto stablecoin which is fully backed by USD. It is a tokenized form of the US dollar, which is pegged at 1:1. It is the very first crypto which is fully backed by a fiat currency, as the USDC reserves are held in segregated accounts with US-regulated financial institutions. 

Whenever a transaction is initiated to buy a USDC with fiat currency, the currency is deposited & stored as 1 USD, post to which a new USDC is minted. Further, if you sell USDC in exchange for USD, the stablecoin is burnt & fiat money is transferred back. Therefore, in this way, USDC maintains its 1:1 peg with the USD.

The USDC coin is managed by Centre, a financial technology company and is compatible with several blockchains like Ethereum, Algorand, Solana, etc.

Additional Read: USDC Whitepaper Summary

Latest News on USD Coin Blockchain

  • The USD Coin recently announced its expansion to 5 other blockchains including Arbitrum One, Cosmos, Polkadot, Near and Optimism. 
  • USDC has now been listed as the first stablecoin on the Robinhood platform, as a result, users will be above to trade or hold the stablecoin

     

Tether vs USD Coin: Comparative Analysis

Tether and USD Coin have been widely accepted and adopted by many in the crypto space. Therefore, now that both have secured their positions in the top 5, which stablecoin is better for you and which one should you choose, USDT or USDC? Let’s check it out!

Tether (USDT) USD Coin (USDC)
Launch Date 06 October 2014 15 May 2018
Founder Managed by a Consortium called Circle Brock Pierce, Craig Sellars & Reeve Collins
Blockchain Protocol Bitcoin, Ethereum, EOS, Tron, Algorad and OMG Network Ethereum, Solana, Avalanche, Tron, Algorand, Stellar, Flow & Hedera
Native Token   USDT USDC
Market Cap $67.95 billion $47.26 billion
Token Type Stablecoin Stablecoin
Circulating Supply 67.94 billion USDT 47.26 billion USDC
Total Supply 70.15 billion 47.26 billion

Technical Analysis: Tether Price vs USD Coin Price

Source: Tradingview

  • USDT & USDC largely maintained their peg and traded along the average levels which included minor surges & pullbacks every now & then.
  • The USDT appears to be pretty volatile compared to that of USDC, which trades very close to the average levels.
  • Presently, USDC coin is trying hard to gain strength by surging slightly high by +0.02%, while the maximum growth is expected around +0.05%.
  • On the other hand, USDT price is being extremely volatile by reaching 0.20% to 0.25% on either side but comes back to normal in no time.

Tether Price Prediction 2022

The Tether (USDT) price has been largely stable and has traded around $1 since its inception. However, a couple of external factors did cause the USDT to lose its peg, but it only remained for a short term. USDT has rebounded and regained its peg each time it lost its peg and also in the times when the peg surged beyond $1. Therefore, USDT has been the most preferred trading pair for a pretty long time. 

The year 2022 has been quite interesting as the USDT, after a long time, has lost its peg and dropped to $0.985. However, Tether burnt nearly 3 billion tokens and regained the peg in no time. Moving forward, USDT price is expected to maintain its peg and fluctuate slightly on either side. The maximum price it may reach in 2022 could be around $1.09 to $1.12, while if it loses its peg, the lower support could be in the range of $0.995 to $0.986. 

USD Coin Price Prediction 2022

The USD coin was extremely volatile initially, soon after its inception, and reached its highs around $1.044, marking the lows at $0.97. However, ever since the previous bull run ignited in the last couple of months of 2020, USDC has maintained its peg at $1. The extreme market conditions also failed to disrupt the rally. On the other hand, the stablecoin witnessed huge adoption due to which USDC is the 4th largest asset after Bitcoin, Ethereum & USDT. 

In the coming days, USDC price is expected to maintain its peg firmly as it is backed by the US Dollar. Hence, the stablecoin appears to be in a very strong position and, if it loses its peg, it could regain it in no time. The maximum level it may achieve in 2022 could be around $1.03, while the lower levels could be capped at around $0.988.

Additional Read: Bitcoin Price Prediction

USDT vs USDT: The Pros

Tether Pros USD Coin Pros
USDT is known to be stable & reliable as it trades around $1  The price of USDC is largely stable as it is backed by the USD
The USDT is the most preferred & trusted trading pair in the market  The platform reserves 1 USD for every USDC & hence has ample of liquidity 
USDT is widely available in almost all the exchanges and also on all major blockchains Has good reputation as it is also backed by Circle’s assets 
USDT is less volatile than Bitcoin or Ethereum or any other crypto  USDC is highly stable compared to the other stablecoins

USDT vs USDT: The Cons

Tether Cons USD Coin Cons
Tether has not maintained a transparent working model due to which it remains under strict surveillance The price remains highly stable and hence no possibility of price appreciation
The authorities have often accused USDT to manipulate the BTC price which in turn impacts the entire crypto markets Considering the current state of ETH network, the fees remain high
Tether is not divisible which limits its functionality USDT dominates the larger potion and hence is always considered next to USDT
It is very difficult to sell large amount of USDT on Tether exchanges The USDC has been very less in operation and hence the awareness may be shallow

Should You Buy USD Coin or Tether (USDT)?

USDT & USDC are the most popular stablecoins in the crypto space, sharing positions within the top 5 crypto assets according to market capitalization. Both stablecoins carry their own potential and purpose to thrive within the crypto space. Therefore, these stablecoins are expected to remain stagnant for the rest of 2022 without losing their peg. 

Additional Read: Which is the best crypto to invest in?

Is Tether a good investment or a USD Coin?

Tether and USD Coin have both been performing extremely well amid the shaky market conditions. Therefore, both coins are considered to carry out any trade more than any other crypto asset. Hence, with deep research and observing the market sentiments, one can consider investing in either USDT or USDC. 

How to Invest in Tether and USD Coin?

Investing in Tether (USDT) or USD Coin (USDC) is simple and safe on CoinDCX, crypto app. All you need to do is just follow a couple of steps mentioned below,

  • Download the CoinDCX App on your smartphone
  • Enter the details required for registration
  • Complete the KYC
  • Once verification is completed, transfer funds to your CoinDCX wallet and buy USDT or USDC

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