Tether is expanding its reach by bringing its flagship stablecoin, $USDT, to the Bitcoin network through the Lightning Network, a leading Layer 2 scaling solution.
The announcement came on January 30 2025 at the Bitcoin-focused Plan B conference in San Salvador, El Salvador, where Tether CEO, Paolo Ardoino, and Lightning Labs CEO, Elizabeth Stark, revealed the strategic partnership.
Today we’re announcing that Tether is coming to bitcoin and Lightning! đ¸âĄ
With the security and decentralization of bitcoin and the speed and scalability of Lightning, USDT will bring hundreds of millions of users and trillions in volume.
It all comes back to bitcoin. pic.twitter.com/Hp6qQCpAVl
â Lightning LabsâĄď¸đ (@lightning) January 30, 2025
According to Tether, Lightning Labs developed the integration using the Taproot Assets protocol, which has enhanced Bitcoinâs ability to support tokenized assets since 2022.
A Major Step for Bitcoin-Powered Stablecoin Transactions
$USDT, the world’s largest stablecoin, currently boasts a $139.4 billion market cap, nearly three times that of its closest competitor, Circleâs $USDC ($53.1 billion), according to CoinGecko data.
Tether has seen explosive growth, processing $10 trillion in transactions in 2024 – putting it within reach of VISA’s $16 trillion transaction volume. The stablecoin is already available across multiple blockchain networks, including Ethereum, Tron, Solana, and Avalanche.
The Lightning Network offers nearly infinite scalability by allowing transactions to occur off-chain, only settling on Bitcoin when necessary. This approach contrasts starkly with the scalability struggles of single-layer blockchains like Solana and Tron.
With this integration, businesses that accept Bitcoin payments via the Lightning Network can now seamlessly add $USDT as a payment option using the same infrastructure.
âMillions of people will now be able to use the most open, secure blockchain to send dollars globally,â said Elizabeth Stark.
She also highlighted the impact this could have on emerging markets, where stablecoins serve as a critical hedge against currency devaluation.
Beyond Payments: The Future of Lightning and USDT
Beyond enabling fast and cheap Bitcoin transactions, Lightning Labs envisions this upgrade facilitating micropayments, AI-driven transactions, and even machine-to-machine payments between autonomous vehicles.
The news comes shortly after Tether relocated its headquarters to El Salvador, the first and only country to adopt Bitcoin as legal tender.
El Salvador has already rolled out Lightning Network-powered infrastructure, including the Chivo Wallet launched in 2021. However, adoption has been mixed, with the government recently shifting Bitcoin acceptance policies from mandatory to voluntary as part of a $1.4 billion agreement with the IMF.
With Tether and Lightning Labs now driving innovation on Bitcoinâs Layer 2, stablecoin-powered payments could be set for mass adoption – blurring the lines between traditional finance and the decentralized future.
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