Tether (USDT) Integrates With Bitcoin (BTC) Ecosystem, Targeting Remittances and Payments

Tether (USDT), the world's largest stablecoin issuer, has announced its integration with Bitcoin's (BTC) ecosystem, marking a new step in the stablecoin's expansion beyond traditional blockchain networks.

Stablecoin giant Tether (USDT) is expanding its presence beyond traditional blockchain networks, announcing its integration with the Bitcoin (BTC) ecosystem.

The move, announced at the Plan B conference in El Salvador on Jan. 30, will see USDT added to both Bitcoin's base layer and the high-speed Lightning Network. This integration will open up new possibilities for remittances, payments, and everyday transactions.

Tether CEO Paolo Ardoino highlighted the initiative's focus on real-world financial applications, stating that the aim is to provide “practical solutions for remittances, payments, and other financial applications that demand both speed and reliability.”

"Millions of people will now be able to use the most open, secure blockchain to send dollars globally. It all comes back to Bitcoin,” said Elizabeth Stark, CEO of Lightning Labs, regarding the broader impact of this development.

The key to enabling this integration is Taproot Assets, a protocol developed by Lightning Labs that allows assets to be issued on Bitcoin's base layer and transactions to be settled on the Lightning Network.

Released in 2023, Taproot Assets essentially integrates stablecoins and other digital assets into Bitcoin's infrastructure, facilitating micropayments and reducing transaction costs.

Once fully integrated, USDT will seamlessly span both Bitcoin's main chain and its Lightning-powered Layer 2 network, combining the security of Bitcoin with the near-instant transaction speeds of Lightning.

Stablecoins have emerged as a massive asset class, with a total market capitalization of over $220 billion. Among them, USDT is the undisputed leader by far.

As of Jan. 30, USDT boasts a market cap of $139.4 billion, which is nearly three times that of its closest competitor, Circle's USD Coin (USDC), with a market cap of $53.1 billion.

In 2024 alone, USDT processed over $10 trillion in on-chain volume, rapidly approaching Visa's annual payment volume of $16 trillion.

Tether's latest announcement comes amid its recent relocation to El Salvador, the only country where Bitcoin is recognized as legal tender.

In a parallel development, El Salvador's Legislative Assembly amended its Bitcoin Law on Jan. 30, reversing the mandatory acceptance of Bitcoin and making it optional for merchants instead. This change aligns with the International Monetary Fund's conditions for a $1.4 billion loan to support El Salvador's economy.