Tether announces that USDT will now be issued on RGB, a highly scalable second-layer protocol running on Bitcoin. This decision marks a strategic and technical turning point for the issuer of the largest stablecoin, reinforcing its commitment to the Bitcoin ecosystem.
USDT will soon be issued on Bitcoin
Did you know that the very first stablecoin, Tether’s USDT, was born on the Bitcoin blockchain? This was made possible by the Omni protocol, which allowed fungible tokens to be created on the very first blockchain on the market.
However, this initiative was quickly shelved due to Bitcoin’s lack of scalability at the time, resulting in high fees, and the emergence of Ethereum and other alternative blockchains designed specifically for smart contracts and token creation. Nevertheless, for several years now, Tether has been actively working, and even financing several projects, to enable a return of USDT to Bitcoin.
Indeed, in early 2025, at the Plan B Forum conference in El Salvador, Paolo Ardoino, CEO of Tether, announced the grand return of USDT to Bitcoin via the Taproot Assets protocol. He also took the opportunity to praise the Lightning Network, hailing its efficiency for instant transfers and payments.
Today, Tether is going even further: the company has just announced that it will issue its USDT stablecoin on RGB, in addition to Taproot Assets. RGB is a highly scalable layer 2 solution running on Bitcoin, which offers a high level of transaction privacy by default.
While the issuance of USDT via the Taproot Assets protocol has been slowed down by several technical and regulatory constraints, including the difficulty of implementing a token freeze feature (necessary in cases of involvement in illegal activities), issuance on RGB promises to be more flexible and straightforward, thanks to the flexibility of its programming language.
RGB is a layer 2 smart contract protocol that can also run on top of the Lightning Network (layer 3). It enables the development of DeFi applications, NFTs, DAOs, and notably stablecoins such as USDT, with advanced privacy and native scalability.
Unlike traditional blockchains, RGB relies on client-side validation: each user verifies their own transactions using a personal history called a “stash.” The states are then anchored to Bitcoin via commitment-type transactions linked to the network’s UTXOs. This architecture reduces congestion on the blockchain, enhances privacy, and opens up new possibilities for the development of complex applications on Bitcoin.
Aren’t dollar stablecoins on Bitcoin contrary to the objective?
With the issuance of stablecoins on Bitcoin, a new attack surface emerges, the same one that already threatens Ethereum: with sufficient capitalization, stablecoin issuers could influence a fork of the blockchain.
These companies, now highly regulated, particularly since the adoption of the GENIUS Act in July 2025, could be pressured or even coerced by the authorities to support a centralized and censurable fork of Bitcoin.
Such a scenario, already plausible for altcoins (which are heavily dependent on stablecoin activity), could also become a reality for Bitcoin and have a significant impact on the price of BTC.
In this case, everything would depend on the will of the community. BTC holders would then need to be committed to preserving the non-censorship of their currency and be prepared to support the honest chain, either by sticking with it at all costs or by abandoning the corrupted version of the chain in order to keep Bitcoin true to its original principles.
