Tether
USDT
Evaluation Score
Overall rating on a scale of 0-10
Crypto Token Health Score Explained
Our AI-powered health score evaluates on-chain metrics, community support, tokenomics, and more. This helps DeFi investors understand risk, compare tokens, and make informed decisions. Learn how to analyze DeFi tokens' risk and use these insights for DeFi portfolio risk management.
AI Analysis
Comprehensive evaluation of the token
USDT (Tether) – Overall Evaluation
Market Leadership & Liquidity
USDT is the largest and most liquid stablecoin, widely used as the primary trading pair across CEXs, DEXs, and DeFi protocols. Its multi-chain availability and deep order books deliver tight spreads and instant on/off ramps.
Tokenomics & Stability
The token adjusts supply dynamically via centralized mint/burn operations to maintain its 1:1 USD peg. Regular third-party attestations support confidence in its reserves, though full transparency and real-time audits remain limited.
Development & Governance Risks
Open-source development is minimal, with a small contributor base and slow public velocity. Governance is highly centralized—holders have no on-chain voting rights, and admin keys can pause, mint, burn, or freeze tokens.
Security Profile
USDT’s contracts are simple and have never been exploited, but the lack of comprehensive public audits and complete centralization of admin controls present potential single-point-of-failure risks.
Conclusion
As a utility for USD-denominated stability and liquidity, USDT excels. However, its centralized governance, reserve transparency concerns, and regulatory scrutiny introduce moderate counterparty risks.
Detailed Analysis by Category
Development Activity
Code updates and developer engagement
Community Support
Social media presence and community engagement
Tokenomics
Supply, distribution, and utility
Market & Use Case
Value proposition and competitive landscape
Team & Governance
Team background and project governance
Security & Audits
Security history and audit status
About Tether (USDT)
Tether (USDT)
Tether (USDT) is a USD-backed stablecoin designed to maintain a 1:1 peg with the U.S. dollar. Launched in 2014 by Tether Limited, USDT provides a digital representation of fiat currency on multiple blockchain networks.
Key Features
- Fiat-Pegged Stability: Each USDT token is backed by reserves intended to match the circulating supply.
- Multi-Chain Support: Available on Ethereum (ERC-20), Tron (TRC-20), Binance Smart Chain (BEP-20), and other blockchains for broad interoperability.
- High Liquidity: Widely traded on centralized and decentralized exchanges, serving as a primary on-ramp and off-ramp between crypto and fiat.
- Transparency & Reserves: Regular attestations and financial reports are published by third-party firms to verify backing assets.
Use Cases
- Trading Pair: Acts as a stable quote and base currency in spot and derivatives markets.
- Remittances: Enables low-cost, near-instant cross-border transfers.
- DeFi Collateral: Used as collateral in lending, borrowing, and decentralized finance protocols.
- Treasury Management: Corporations and projects hold USDT to mitigate volatility risk.
Technical Details
- Token Standard: ERC-20, TRC-20, BEP-20, and more
- Total Supply: Varies dynamically based on issuance and redemption
- Smart Contract Audits: Subject to security reviews by independent firms
Issuance & Redemption
Tether Limited issues USDT when users deposit USD into the company’s reserve accounts and redeems tokens when users return USDT for fiat. This mechanism is intended to maintain price stability at $1 USD per USDT.
For more information, visit the official Tether website or check blockchain explorers for contract addresses and real-time data.
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