USDC vs USDT: stablecoins explained

USDC and USDT are the two largest stablecoins: tokens on a blockchain meant to be worth exactly one US dollar each, backed by reserves their issuers hold. USDT is issued by Tether and is the larger and more widely traded; USDC is issued by Circle and publishes its reserves in more detail. For sending and receiving dollars on a blockchain, both work, and the network matters as much as the coin.

What a stablecoin is

A stablecoin is a token whose value is tied to a currency, almost always the dollar. The issuer creates new tokens when someone deposits dollars and destroys them when someone redeems, and holds reserves — mostly cash and short-term US government debt — to cover every token. That gives you dollars that move like crypto: to anyone with an address, at any hour, usually within minutes.

How USDC and USDT differ

• Issuer. USDT: Tether, since 2014. USDC: Circle, since 2018.
• Reserve reporting. Both publish independent accountants' attestations of their reserves on their Circle and Tether transparency pages; Circle publishes monthly and breaks down where the reserves are held.
• Regulation. In the EU, the MiCA regulation's stablecoin rules have applied since 30 June 2024, and Circle issues USDC under them; several exchanges have restricted USDT for users in the European Economic Area. In the US, the GENIUS Act, signed on 18 July 2025, sets federal rules for payment stablecoins.
• Where they are used. USDT has the larger supply and dominates trading on many exchanges and payments in parts of the world. USDC is common in US-facing services and in on-chain applications.

Networks matter as much as the coin

Each stablecoin runs on several blockchains. USDC is on Ethereum and on layer-2 networks such as Base, Arbitrum and Optimism; USDT is mostly on TRON and Ethereum, and on Arbitrum and Optimism as USDT0, an omnichain form of USDT backed one to one by USDT locked on Ethereum. USDC on Base and USDC on Ethereum are the same dollar but separate tokens on separate chains. Sending on one network to an address that only watches another can lose the payment, so sender and receiver must agree on the network as well as the coin. Fees differ hugely between networks — network fees explained.

The risks they share

• Reserve risk. A stablecoin is only as good as the reserves behind it. In March 2023 USDC briefly traded well below a dollar after Circle disclosed that part of its reserves sat in the failed Silicon Valley Bank; it returned to a dollar once those deposits were guaranteed.
• Freezing. Both issuers can freeze tokens at an address, and do so on law-enforcement requests. A stablecoin is not censorship-resistant the way bitcoin is.
• Wrong network, wrong address. Like any blockchain payment, a mistake is usually final.

Which one to use

Use what the person or service on the other side accepts, on the network they name. For your own holdings, many people prefer USDC for its reporting and regulatory status, and USDT for its reach. Holding some of each spreads the issuer risk. For a business, accepting both on low-fee networks covers most buyers — how to accept crypto payments.

This guide explains how things work. It is not financial, investment or tax advice. Something wrong? Write to hi@perly.io and we will correct it.