Stablecoin USDT Announces Integration with Lightning Network
2025-01-31
Bittime - Tether, issuer of the USDT stablecoin, announced plans for integration with Lightning Network, Bitcoin's Layer 2 solution.
Lightning Labs, the company behind the Lightning Network, is leveraging the Taproot Assets protocol to bring USDT to the Bitcoin network. This aims to increase transaction speed and reduce the cost of sending stablecoins.
Integration of Stablecoin USDT and Lightning Network
Tether CEO, Paolo Ardoino, and Lightning Labs CEO, Elizabeth Stark, announced this partnership at the Plan B Conference in San Salvador, El Salvador, on January 30, 2024.
In a blog post, Tether explained that the integration of the USDT stablecoin and Lightning Network was developed by Lightning Labs to expand the functionality of the Bitcoin network in supporting tokenized assets starting in 2022.
Read Also: USDT Market Capitalization Hits New Record of $120 Billion
Stablecoin USDT Domination
USDT is the world's largest stablecoin with a market capitalization of $139.4 billion, far surpassing its closest competitor, USD Coin (USDC), which has a capitalization of $53.1 billion according to CoinGecko data.
By 2024, Tether will have processed $10 trillion worth of transactions, approaching payments giant Visa's $16 trillion transaction volume.
Currently, the dominance of the USDT stablecoin is proven by the availability of this stablecoin on more than 10 blockchains, including Ethereum, Tron, Solana, and Avalanche.
Benefits of Stablecoin USDT and Lightning Network Integration
This integration of the USDT stablecoin and Lightning Network allows merchants who accept Bitcoin payments via the Lightning Network to add USDT as a payment option without the need for additional infrastructure.
That way, users can more easily send and receive payments in the form of USDT stablecoins with high efficiency.
This integration of the USDT stablecoin and Lightning Network also opens access for users in developing countries who rely on stablecoins to protect the value of their assets from inflation.
Read Also: USDT Dominance Is the Key to Stablecoin Stability, Here's a Fact
Potential of Stablecoin USDT in the Bitcoin Ecosystem
This integration of the stablecoin USDT and Lightning Network not only facilitates payments with USDT, but also paves the way for automated transactions involving AI and autonomous vehicles.
Not only that, micropayments using the USDT stablecoin on the Lightning Network are expected to increase.
Meanwhile, Tether has moved operations to El Salvador, the first country to designate Bitcoin as legal tender. El Salvador has adopted the Lightning Network via the Chivo digital wallet since September 2021.
Read Also: Tether Successfully Prints 1 Billion USDT on the Ethereum Network
FAQ Tether (USDT)
What is Tether (USDT)?
Tether (USDT) is a stablecoin whose value is pegged 1:1 to the US dollar, designed to maintain a stable value and reduce the volatility common to other crypto assets.
How Does Tether (USDT) Work?
Each USDT stablecoin token in circulation is backed by an equivalent asset reserve, to ensure that each token has the same value as one US dollar.
On Which Blockchains Is USDT Stablecoin Available?
Stablecoin USDT is available on various blockchains, including Bitcoin (via the Omni protocol), Ethereum (as an ERC-20 token), and Tron (as a TRC-20 token).
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Reference
Coin Telegraph, Tether’s stablecoin to be integrated into Bitcoin Lightning, accessed January 31, 2025.
Author: IPR
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