Tech Tether's USDT, the largest stablecoin globally, is anticipated to make its return to the Bitcoin network this month, marking over ten years since its initial release on the platform.
Utexo Project to Enhance USDT Functionality on Bitcoin
Backed by Tether, the Utexo project is set to facilitate private transfers of USDT, allow direct exchanges between BTC and USDT, and provide loans secured by BTC, all while minimizing the visibility of transaction details on Bitcoin’s public ledger.
“It’s coming home,” Tether CEO Paolo Ardoino expressed on X recently, emphasizing the return of USDT to Bitcoin.
Originally launched on Bitcoin through the Omi protocol in 2014, USDT has since transitioned to Ethereum and Tron as its primary networks. Now, it is poised to re-enter the Bitcoin ecosystem via Utexo’s newly developed infrastructure.
Utexo, founded in 2025 and having secured $7.5 million in seed funding this year, has obtained the necessary commercial license to issue USDT on Bitcoin. Co-founder Viktor Ihnatiuk shared with CoinDesk via Telegram that the project aims to integrate the stablecoin into exchanges, wallets, and payment systems.
“Tether has always been a Bitcoin company,” Ihnatiuk told CoinDesk in a recent discussion. “Bitcoin represents a safe haven for Tether, akin to gold. This is why Tether has consistently acquired BTC and supported the Bitcoin ecosystem.”
As of mid-August 2026, Tether holds approximately 100,000 BTC, valued at around $8.4 billion, according to Bitcoin Treasuries.
“While I cannot speak on behalf of Tether, it is clear that Bitcoin is a significant focus for them, and it is our responsibility to ensure USDT is as accessible on Bitcoin as it is elsewhere,” Ihnatiuk added.
Enhanced Privacy Features
Utexo aims to provide a more private infrastructure for USDT compared to its counterparts on Ethereum or Tron.
The implementation of the RGB protocol will utilize client-side validation to keep transaction details largely off the Bitcoin public ledger, anchoring ownership in unspent transaction outputs (UTXOs), similar to receiving change after a cash transaction.
Unlike Ethereum and Tron, which utilize account-based models sharing transaction data on public ledgers, Utexo’s structure allows transaction specifics to remain off-chain between the parties involved, relying on Bitcoin’s ledger solely for cryptographic proof of ownership.
Utexo will facilitate USDT issuance on Bitcoin, offering the necessary infrastructure for exchanges, wallet services, and payment providers through APIs, SDKs, and cloud solutions.
The primary applications include private USDT transfers; direct swaps between native BTC and USDT without the need for an exchange; and lending, where borrowers can use native bitcoin as collateral without needing to convert it onto another blockchain, as seen with wrapped tokens like WBTC.
However, the privacy functionality comes with a caveat.
RGB assets are tethered to Bitcoin UTXOs, which means Utexo cannot freeze them in the same way that Tether can freeze an Ethereum address. Instead, Utexo will maintain a blacklist of UTXOs linked to sanctioned or illegal activities and share that information with exchanges and service providers.
“The UTXO would simply become unredeemable, preventing anyone from sending it back to a bridge or minting tool or withdrawing it to Ethereum or Tron,” Ihnatiuk explained.
Following the launch of USDT issuance on Bitcoin next month, Utexo plans to expand into the Lightning Network, a layer-2 solution designed for quicker, cheaper Bitcoin transactions.
The aim is to position USDT as a payment token for transaction fees on Lightning, similar to how USDC is utilized on the new blockchain network developed by USDC issuer Circle.
Bitcoin NewsTether AI Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.Latest Crypto News- 1Bitcoin tops $86,000 ahead of U.S. jobs report48 minutes ago
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The Definitive Stablecoin Landscape Series: Asia Pacific
The Definitive Stablecoin Landscape Series: Asia Pacific
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
By CoinDesk ResearchSep 15, 2026 Commissioned byRippleAs stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
Why it matters:
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
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