USDT Returns to Bitcoin via Utexo's RGB Protocol

The largest stablecoin, USDT, is returning to the Bitcoin network via infrastructure provider Utexo after a decade-long absence. Utexo's co-founder Viktor Ihnatiuk stated that the company has obtained a commercial license to issue USDT on Bitcoin and use Tether's trademark, while providing the necessary infrastructure for exchanges, wallets, and payment providers. The rollout will utilize the RGB protocol, which anchors assets to Bitcoin while keeping most transaction information outside the blockchain's publicly visible transaction history.

USDT's market capitalization stands at approximately $184 billion, making it the world's largest stablecoin. Tether has also financially backed Utexo, having co-led the company's $7.5 million seed round in March alongside Big Brain Holdings and Portal Ventures. The new implementation is structurally different from the original USDT on Bitcoin, which used the Omni Layer.

The Utexo implementation, utilizing RGB, relies on client-side validation, meaning counterparties retain the data needed to validate an asset transfer rather than publishing the full transaction history to Bitcoin's blockchain. This approach is intended to provide greater privacy and compliance for users. Utexo is targeting three initial applications: private USDT transfers, direct swaps between native Bitcoin and USDT, and lending structures where native BTC can serve as collateral without being converted into a wrapped token on another blockchain.