Tether, the crypto company behind the largest stablecoin, is introducing its $140 billion USDT token to Bitcoin — the blockchain that underpins the largest and oldest cryptocurrency — and Bitcoin-based scaling service Lightning Network, the company announced on Thursday.

Announced at the Plan B conference in San Salvador, Tether CEO Paolo Ardoino said that bringing USDT to Bitcoin and Lightning aims to offer “practical solutions for remittances, payments, and other financial applications that demand both speed and reliability.”

Stablecoins: A $200 Billion Digital Asset Class

Stablecoins are a $200 billion digital asset class with their prices anchored to an external asset, predominantly the U.S. dollar. They serve as a bridge between government-issued money and blockchain-based digital assets, and are increasingly popular for everyday uses like payments, savings, and remittains, especially in emerging countries.

Activity and Supply Concentrated on Smart Contract Platforms

While stablecoin usage has rapidly expanded over the past years, activity and supply are mostly concentrated on smart contract platforms like Ethereum, Tron, and Solana.

USDT’s Integration with Bitcoin Made Possible by Taproot Assets

What makes USDT’s integration with Bitcoin possible is Taproot Assets, a piece of infrastructure that allows asset issuances on the Bitcoin base layer and transfers over the Lightning Network, a scaling platform focusing on fast and cheap transactions, thus making micropayments more cost-efficient. The protocol, developed by Lightning Labs and released last year, opens the way to bring external tokens like stablecoins to the Bitcoin ecosystem.

“Millions of people will now be able to use the most open, secure blockchain to send dollars globally,” said Elizabeth Stark, CEO of Lightning Labs, development organization behind the Lightning Network. “Bringing USDT to Bitcoin combines the security and decentralization of Bitcoin with the speed and scalability of Lightning,” she added.

Conclusion

The integration of USDT with Bitcoin’s Lightning Network marks a significant milestone in the development of the stablecoin ecosystem, providing a new era of unstoppable technology for financial applications that require both speed and reliability. This collaboration is expected to expand the use cases of stablecoins, making them more accessible and efficient for users worldwide.

FAQs

• What is Tether? Tether is the largest stablecoin, with a market capitalization of $140 billion.
• What is the purpose of bringing USDT to Bitcoin’s Lightning Network? The integration aims to provide practical solutions for remittances, payments, and other financial applications that demand both speed and reliability.
• What is Taproot Assets? Taproot Assets is a piece of infrastructure that allows asset issuances on the Bitcoin base layer and transfers over the Lightning Network, making micropayments more cost-efficient.
• Who is behind the development of Taproot Assets? Taproot Assets was developed by Lightning Labs, the development organization behind the Lightning Network.
• What are the benefits of this integration? The integration brings together the security and decentralization of Bitcoin with the speed and scalability of the Lightning Network, making it a more efficient and reliable option for financial applications.