USDT vs USDC: Which Stablecoin Is Better For You?

USDT vs USDC: Which Stablecoin Is Better For You?

Stablecoins have been around for nearly a decade. They have brought some stability to the volatile crypto market and become an alternate way to send money across countries, especially within Africa, without the stress of dealing with traditional payment methods.

Tether (USDT) and USD Coin (USDC) are two of the most popular stablecoins in the cryptocurrency market. This article explains their differences and helps you understand which might be better for your trading needs.

What is a Stablecoin?

A Stablecoin is a type of cryptocurrency that is tied to something like regular money or gold so that it doesn't go up and down in value as much as other cryptos like BTC, ETH, PEPE, DOGE and XRP, etc.

This helps make it more predictable and stable since it's pegged(tied) to the same value of a generally stable fiat currency like the U.S. Dollar or a commodity like gold.

Types of Stablecoins

There are different types of Stablecoins based on the type of collateral used to back them, and the following are the most common:

  • Fiat-backed Stablecoins

For fiat-backed Stablecoins, the creator or organisation managing it will set up a reserve where a particular amount of the asset collateral for the Stablecoin is stored.

In traditional banking and finance, reserves are funds businesses, banks, or governments set aside to be ready for unexpected expenses or losses. They are like a savings account that provides financial stability during challenging times.

In the context of crypto stablecoins, reserves mean that for each Stablecoin a trader has, an equal dollar is backing it in those reserves. Basically, for each fiat-backed Stablecoin like USDT and USDC in a wallet, there is 1 dollar in reserve.

Independent trustees and auditors maintain these reserves and frequently check them to ensure they follow legal and financial regulations.

USDT and USDC are commonly traded fiat-backed Stablecoins. Their value is equivalent to 1 U.S. dollar; this means 1 USDT $1 and 1 USDC $1.

  • Commodity-backed Stablecoins

These are Stablecoins backed by commodities like real estate or precious metals like gold or silver to help them maintain their value. An example of a Stablecoin backed by gold is Digix.

  • Crypto-backed Stablecoins

These Stablecoins are backed by other cryptocurrencies. Since the cryptocurrency used as a reserve is typically volatile, crypto-backed Stablecoins are typically over-collateralised. This means that a larger amount of cryptocurrency tokens are stored in reserve for distributing a smaller amount of these Stablecoins. An example of a popular crypto-backed Stablecoin is DAI. It runs on the Ethereum blockchain, and its value is pegged to the U.S. dollar.

  • Algorithmic Stablecoins

These Stablecoins use a computer algorithm to stabilise their value. For instance, if the price of an algorithmic Stablecoin is tied to $1, but the Stablecoin increases in price, the algorithm automatically issues more tokens into the supply chain to lower the price. Similarly, if the price falls below $1, the algorithm will reduce the supply to raise the price back up. An example is Frax.

USDT vs USDC: Which Stablecoin Is Better For You?

What is USDT?

Tether is owned by a Hong Kong-registered company called iFinex. The company also owns the BitFinex crypto exchange.

Tether was initially launched as RealCoin in July 2014 and was renamed and rebranded as Tether in November 2014.

USDT works on the Bitcoin, Ethereum, TRON, EOS, Algorand, Solana, and Bitcoin Cash blockchains.

According to CoinMarketCap, USDT has a Market Cap of $82.8B.

What is USDC?

USD coin is owned by Centre, a consortium jointly founded by Circle, a fintech (financial technology) company and Coinbase, a cryptocurrency exchange.

USDC works on the Ethereum, Solana, Stellar, TRON and Algorand blockchains.

According to CoinMarketCap, USDC has a  Market Cap of $29.7B

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Regulatory Compliance: USDT vs USDC

Tether is audited by BDO Italia and provides quarterly reports on its platform functionality and the state of its reserves used to back its USDT stablecoin.

The circle is audited by Grant Thornton LLP and provides monthly reports on their transparency page on the performance of their USDC stablecoin.

Transaction Speed and Fees - USDT VS USDC

Transaction Speed of USDT

The speed of USDT transactions depends on the blockchain you are using.

USDT transfers take 1 to 10 minutes to complete using the ERC-20 network and 5 to 20 seconds using the Solana and Polygon blockchains.

Another factor that affects transaction speed is network congestion. For instance, the ERC-20 network on the Ethereum blockchain is often used by traders, and this causes heavy networks on the blockchain, leading to transaction times going up as high as 30 minutes to 1.5 hours.

If you can't wait and need a faster transaction, you may need to pay a higher transaction/gas fee to move your USDT transaction faster for confirmation.

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How Much Does It Cost To Send USDT?

USDT transaction costs depend on which wallet and blockchain are used for the transfer. For instance, if you send USDT with ERC-20 on the Ethereum blockchain, it may be more expensive than sending through a Solana blockchain.

As a result of the Ethereum blockchain's limited capacity to handle heavy transactions, sending USDT can become significantly expensive, reaching tens of dollars.

On the other hand, blockchains like Solana have a better capacity to handle a heavy flow of transactions, which means USDT transfers will be cheaper using their blockchain, and transaction fees will generally be less than $1.

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Transaction Speed of USDC

The transaction speed of USDC depends on the blockchain you use to make the trade or transfer. If you use the Ethereum blockchain, USDC transactions can take 5 to 20 minutes to complete.

On the other hand, if you use blockchains like Tron, Avalanche or Algorand, your USDC transfers can be completed in less than a minute.

Furthermore, blockchains such as Polygon and Solana can complete your USDC transfer in 5 to 20 seconds or 1 minute when there's heavy congestion.

How Much Does It Cost To Send USDC?

The cost of sending USDC depends mainly on the wallet and cryptocurrency exchange you are using. The average fee to send USDC ranges from 0.1% to 0.15% of the amount you’re transferring.

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Which Stablecoin Should You Use?

Choosing between USDT and USDC depends on what you want at the time, especially as they are both ≈ 1:1 with the US Dollar and run on nearly the same blockchains.

A key difference, however, is their transaction cost. USDC tends to be cheaper to transfer than USDT. Conversely, USDT is more popular among traders and businesses that accept cryptocurrency.

To help your decision, here is a table detailing their features:






Circle and Coinbase

Year Launched



Market Cap

$82.8 Billion

$29.7 Billion

Supported Blockchains

Bitcoin, Ethereum, TRON, EOS, Algorand, Solana, and Bitcoin Cash blockchains.

Ethereum, Solana, Stellar, TRON and Algorand 

Transfer Speed

1 - 10 minutes (Ethereum network) 

5  - 20 seconds (Solana and Polygon network)

5 - 20 minutes (Ethereum network) 

Less than 1 minute (TRON, Avalanche Algorand)

5  - 20 seconds (Solana and Polygon network)

Average Transaction Fee

0.29 - 25 USDT.

0.1% to 0.15 of the total transaction amount

Stablecoins combine the accessibility of cryptocurrencies with the stability of fiat currencies they're pegged to, like the U.S. Dollar. Stablecoins, especially fiat-backed coins like USDT and USDC, have recently been frequently used to hedge against inflation, especially in developing countries like Nigeria.

The choice between USDT and USDC depends mainly on your trading needs and business preferences. Regardless of your choice, you can trade, swap, and transfer USDT and USDT on Obiex.

With the Obiex app, you can easily trade over 20 cryptocurrencies. Sign up on Obiex today in less than 2 minutes!

Disclaimer: This article was written by the writer to provide guidance and understanding of cryptocurrency trading. It is not an exhaustive article and should not be taken as financial advice. Obiex will not be held liable for your investment decisions.