During this month of October, USDT is set to make its return on Bitcoin, thanks to Utexo, an infrastructure supported by Tether and built around the RGB protocol. Thanks to this launch, confi
During this month of October, USDT is set to make its return on Bitcoin, thanks to Utexo, an infrastructure supported by Tether and built around the RGB protocol. Thanks to this launch, confidential transfers, direct exchanges between BTC and USDT as well as loans secured by native bitcoin will be possible, without exposing all operators on the public blockchain.
Utexo plans to start issuing USDT on Bitcoin during this month of October. The company claims to have obtained a commercial license that allows it to use the Tether brand and offer this new infrastructure to exchanges, wallets, and payment providers.
However, no specific date has been communicated yet. This deployment is therefore still expected during the month, but it should not be presented as a service already accessible to all users.
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Paolo Ardoino, the head of Tether declares :
USDT on Bitcoin. It’s coming home.
On his side, Viktor Ihnatiuk, co-founder of Utexo, explains that the goal is to make USDT as accessible on Bitcoin as it already is on other blockchains.
With a valuation close to $190 billion, USDT remains the market’s leading stablecoin. Its launch on Bitcoin would thus expand the network’s uses beyond BTC storage and transfer.
For this launch, it is not about inserting all USDT transactions directly in each Bitcoin block. Utexo relies on RGB, a protocol that uses Bitcoin to prove asset ownership while keeping all data among participants.
RGB relies on client-level validation. Each user must verify the information required for a transaction without asking all Bitcoin nodes to store its entire history. The network notably anchors a cryptographic proof related to unspent bitcoin units called UTXOs.
Such architecture differs from how USDT operates on Ethereum or Tron. On these blockchains, balances and transfers appear in a public ledger based on accounts. Thanks to RGB, transaction details mostly remain off-chain and are only disclosed between involved parties.
However, confidentiality will depend on the applications used and their implementation. It should therefore not be confused with absolute anonymity.
Three services are highlighted by Utexo. The first relates to private payments in stablecoins. Indeed, users would transfer digital dollars without disclosing their balance and complete transactions in a register visible to all.
The second use concerns direct exchanges between BTC and USDT. A person would convert native bitcoins into stablecoins without going through a wrapped bitcoin on another blockchain. This solution could reduce certain risks linked to bridges and custodians whose role is to guarantee tokens like WBTC.
The third service relates to credit. Thus, borrowers would deposit native bitcoin as collateral to obtain liquidity in USDT. Utexo primarily targets custodians, wallets, payment providers, and companies managing large volumes.
The Lightning Network is expected in a second phase. It should thus enable faster and cheaper payments than those automatically settled on Bitcoin’s main layer. However, Utexo has not announced a strict schedule for this extension.
The expression “return home” refers to Tether’s history. USDT was launched in 2014 on Omni Layer, a protocol built on top of Bitcoin. Then, Ethereum and Tron became its main infrastructures due to lower costs and better integration with exchanges.
Tether stopped supporting USDT on Omni in 2023. The stablecoin is therefore not returning after ten years of absence. Instead, it is returning to its original network more than ten years after its creation, with different technology.
This new model raises compliance questions. Utexo will not be able to freeze a UTXO as Tether blocks an address on Ethereum. The company plans instead to blacklist units linked to sanctions or illicit activities. Thus, exchange platforms and other operators would have to refuse their conversion or withdrawal.
“Bitcoin deserves a truly native, lightweight, private, and scalable stablecoin,” said Paolo Ardoino during the initial announcement of the RGB project. The success of the launch will now depend on how many wallets and exchanges will actually integrate this new version of USDT.
