USDC vs USDT: Which Stablecoin Should You Use? (2024)

The crypto market is typically known for the high volatility of its assets. However, it has continued to attract more users with the advent of tokens that are pegged to fiat currencies with a stable value, known as stablecoins. Stablecoins permit its users to trade in the crypto space without being exposed to frequent price fluctuations, as it is the case with other digital currencies like Bitcoin and Ethereum.

Within the crypto market today, Tether USD (USDT) and USD coin (USDC) stand out as the most popular stablecoins. Both tokens are backed by the US dollar and have several similar use cases. However, there are substantial differences between them.

This article makes a comparison of USDT and USDC aimed at helping you choose which of the tokens to likely trade as you enter the crypto space.

What Is A Stablecoin?

A stablecoin is a type of cryptocurrency that has a fairly consistent price. Stablecoins usually have this stable value because they are pegged to a fiat currency with a strong, stable value such as the US Dollar. This means that traders and investors can use stablecoins without fear of price fluctuations.

There are many examples of stablecoins but the most popular ones backed by the dollar are USDT and USDC.

Read More: What is Tether USD (USDT) and What is USD Coin (USDC)

Brief Stablecoin Overview: USDC vs USDT

USDC Origin

USDC fully known as USD Coin is a stablecoin backed by the US dollar at a 1:1 ratio making it stable. The USDC token was founded by Coinbase and Circle in 2018 and is governed by the Centre consortium.

USDC Stability

USDC has remained fairly stable and pegged to $1 since its inception. While there might be slight fluctuations, it always reverts back to $1, making it stable and reliable.

USDC Volumes

At the time of writing, USDC has a market cap of just over $43 million and has been comfortably trading in the top 5 of the cryptocurrency charts. The high market volatility and bullish market run have caused many investors to switch to stablecoins.

USDT Origin

USDT also known as Tether or USD Tether is a stablecoin backed by the US dollar at a 1:1 ratio. The USDT token was founded in 2014 by Hong Kong-based Tether Limited.

USDT Stability

USDT is one of the stablecoins that has remained the most unshaken at $1, considering how long it has stayed there. While there might be slight fluctuations, it always reverts back to $1, making it stable and reliable.

USDT Volumes

At the time of writing, USDT has a market cap of just over $71 million and has been trading comfortably in the top 3 of the cryptocurrency charts. The high market volatility and bullish market run have caused many investors to switch to stablecoins.

What is Similar Between USDT vs USDC

There are three major similarities between USDT and USDC as seen below;

1. Fiat-backed tokens
   Both tokens are fiat-backed and have a 1:1 ratio with the US dollar. As such, they are stable in nature compared to other cryptocurrencies that do not have any tangible assets representing their value.
   Being backed by the US dollar makes them acceptable on major crypto exchanges. As such, they can be traded or exchanged for other cryptocurrencies easily.
2. Transparency and reliability
   USDT and USDC are centralised stablecoins that require the trust of their issuers. Consequently, Tether, the issuer of USDT, relies on the audits of BDO Italia and provides reports on a quarterly basis on the stakes of its platform and reserves, and Circle provides monthly attestations for USDC on their transparency page based on the audits of Grant Thornton LLP. These prestigious accounting firms are important in establishing the legality of the USDT and USDC.
3. Available on trusted blockchains
   Basically, USDT and USDC are powered by the Ethereum blockchain. However, they are expanding and being supported on other blockchain platforms like TRON, Solana, and Algorand.

Differences Between USDT vs USDC

USDT has been on the market for over four years compared to USDC, which is relatively new. For instant trading on crypto exchanges, it does not matter if you use USDT or USDC, but for long-term trade or holding them as a store of value, it is worth considering the differences below.

1. Price Stability
   Stability issues experienced by stablecoins should not be confused with the volatility of other cryptocurrencies.
   In terms of stability, USDC has been more stable than USDT. In 2019, USDT witnessed an occasional fall in price, occasionally below $1.00. That same year, its price rose as high as $1,000 per USDT. On the other hand, the price of USDC has remained stable and maintained its 1:1 ratio with the USD since its creation in 2018.
2. Market capitalisation
   USDT has a higher market capitalisation with circulating supply of $67.5 billion, thus trading high volumes daily, compared to USDC with a market cap circulating supply of $52 billion. As such, traders prefer to trade more with USDT than USDC.

How to trade USDT or USDC on Yellow Card

You can buy and sell USDT or USDC on Yellow Card following the steps below:

Buy USDT or USDC

1. Sign up
   Sign up for a Yellow Card Account with some basic and personal information;
2. Fund your account
   Fund your account with your local through using one of the multiple funding methods available;
3. From your dashboard, click on “Deposit” and follow the procedure to deposit the amount you want instantly;
4. Buy USDT or USDC
   From your dashboard, click “Crypto” and select the token you want to buy, then enter the amount you want to buy in your local currency;
5. Confirm the transaction and have your token (USDT or USDT) will instantly be sent into your wallet.

Sell USDT or USDC.

1. Sign in to your Yellow Card account;
2. Click “Crypto” and select the token you want sell;
3. Enter the amount you want to sell, and instantly, your balance in local currency will reflect in your wallet;
4. From your dashboard, select “Withdraw” and choose your preferred withdrawal method;
5. Follow the procedure to withdraw the amount you want.

That’s all! Your money moves are made easy with USDT and USDC through the Yellow Card exchange platform.

Start trading stablecoins today