USDC vs USDT: what it is and the differences

In the world of cryptocurrencies, where volatility is often very high, stablecoins have become a lifeline for investors. Two giants in particular stand out among them - USDC (USDC Coin) and USDT (Tether). As of August 2024, these two digital currencies together hold more than 80% of the stackablecoin market with a total capitalization of more than $100 billion. 

In this article, we will understand what USD Coin is, how it works and why more and more investors are choosing it over its more popular “big brother” USDT. We will analyze their differences in transparency, technology, and regulatory environment to help you understand which stablecoin may better suit a particular investment need.

What is the difference between USDC and USDT

USDT and USDC are stablecoins, a special type of cryptocurrency token created to maintain a constant value. This is why they are tied to the value of a stable asset, most often the U.S. dollar, which makes them less volatile than other cryptocurrencies. 
Stablecoins come in different types: backed by fiat currencies, cryptocurrencies, commodities, and algorithmic. 

The difference between USDT and USDC lies primarily in the issuers and collateral approaches. USDC is issued by Circle in partnership with cryptocurrency exchange Coinbase, while USDT is issued by Tether Limited. USDC is fully collateralized by U.S. dollars and short-term U.S. Treasury bonds held in accounts at regulated U.S. financial institutions. Circle is regularly audited and publishes reports on its reserves. USDT, on the other hand, was criticized for a fairly long period for its lack of transparency regarding its collateral, but Tether has recently corrected itself and reports on their reserves have been made available to the public.

The second key difference is regulatory status and cooperation with financial authorities. The USDC is actively working to meet US regulatory requirements, having obtained licenses to operate in many states. 
Circle is also working with regulators to develop standards for stablecoins. USDT, on the other hand, has had some issues with them, including an $18.5 million fine imposed by the New York City prosecutor's office in 2021 for making false security claims. 

USDC Types (TRC20, ERC20, Sol, Near, Arbitrum, Polygon)

USDC, like many other tokens, exists on different blockchain platforms. This allows you to choose the most convenient and cost-effective way to use USDC depending on the needs and preferences of a particular network.

Here are some of them:

• ERC20 (Ethereum): the most popular and most widely used type of USDC. It remains relevant despite sometimes high commissions on the Ethereum network.
• TRC20 (Tron): very popular due to low fees and fast transactions. Often used for transfers between exchanges.
• SOL (Solana): gaining popularity due to its speed and low network fees. Relevant for DeFi projects on this platform.
• Polygon: popular for Ethereum users looking for lower commissions. Relevant for DeFi and GameFi projects.
• Arbitrum: benefits from low commissions and Ethereum compatibility. Relevant for DeFi users.
• NEAR: less popular than the others, but has its own niche. Relevant for the NEAR ecosystem.

How to create a USDC wallet

Creating a USDC wallet is easy with Trustee Plus. This feature-rich cryptocurrency platform offers a user-friendly mobile app for iOS and Android, which makes managing USDC tokens and other cryptocurrencies much easier.

To create a USDC wallet, you will only need:

• Smartphone
• Verification document

Benefits of using Trustee Plus for USDC:

• Automatic creation of wallets for more than 30 digital assets, including USDC;
• Possibility to issue a payment card for cryptocurrency settlements;
• 0% commission on stablecoin exchanges, transfers and crypto top-ups;
• User-friendly interface for fast transactions between users.

To create a USDC wallet, simply download the Trustee Plus app, register and verify. You will then have access to your USDC wallet and other platform features.

Important: For detailed instructions on how to create a USDC wallet, visit the official Trustee Plus website.

How to buy USD Coin for Euros

Before you can buy USD Coin, you need to download the Trustee Plus app, verify your account, fund your balance with your bank card and exchange Euros to USDC. The whole process takes just a few minutes.

Important: for detailed step-by-step instructions on how to buy USDC for Euros, visit the instructions page on the official Trustee Plus website.

Summary

Now you know the answer to the question of what USDC and USDT are. As the leading stablecoins in the crypto market, these coins play an important role in today's digital economy. They offer the stability and liquidity necessary for the efficient functioning of cryptocurrency exchanges, DeFi platforms, and international transfers.

Although both stablecoins are functionally similar, USDC stands out for its transparency and cooperation with regulators, making it an attractive option for investors (including institutional investors) who value reliability and regulatory compliance.