USDT and USDC
Many people only look at the names and might think that USDT and USDC are both stablecoins pegged to the US dollar, with similar properties and risks.
But upon deeper understanding, one will find that they are fundamentally different: one was born from spontaneous demand in a chaotic market, while the other is a result of proactive design from a regulatory framework.
One comes from the streets, the other from the system.
USDT (Tether) has never marketed itself based on compliance; its core logic is "as long as it works, that's good enough." Its mission is to provide on-chain dollars to anyone in the world who does not have a bank account.
- Low reserve transparency, many historical controversies
- Frequently cited by regulators
- Yet it consistently occupies the highest trading volume and circulation
This seems contradictory, but in reality, it is reasonable. In regions where the financial system is inadequate or excluded—such as gray trade in the Middle East, hyperinflationary countries in South America, and small cross-border traders in Southeast Asia—there is no need for perfect assets, only readily available dollars. USDT just fills this gap.
The more chaotic a country's finances are and the more closed its formal dollar channels are, the more vigorous the demand for USDT becomes. It does not provide a sense of security, but rather the ability to survive. USDT is a self-rescue product of the market's demand for dollars.
USDC (USD Coin issued by Circle) has aimed at a completely different customer base since its inception: financial institutions, compliant enterprises, and regulated markets.
- Regular disclosure of reserves, transparent custody
- Deeply influenced by the U.S. regulatory framework
- Structure may change with policy adjustments
USDC is the extension of the U.S. regulatory system on the blockchain. What it brings is not maximum liquidity, but "legitimacy." When banks, payment companies, and listed companies need on-chain dollars for reconciliation, auditing, and compliance operations, USDC is the only target they dare to choose.
However, compliance also means control: assets may be frozen, addresses may be blacklisted, and cross-border use may be restricted. USDC is not a tool for de-dollarization, but a tool for the digital governance of the dollar.
USDT: Dominates in disordered and excluded regions
USDC: Expands in orderly and institutionally dense regions
The world simultaneously exists with both "orderly" and "disordered" aspects; therefore, neither will replace the other in the short term. This is the true meaning of stablecoins. $BTC
