1 Risk Crypto Investors Should Watch With Tether
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By Adé Hennis – Dec 16, 2025 at 6:09PM ESTKey PointsTether is the most traded stablecoin on the market, but investors should be mindful of transparency. USD Coin may offer better transparency for those who value that more than liquidity. These 10 Stocks Could Mint the Next Wave of Millionaires ›CRYPTO: USDTTetherMarket Cap$186BToday's Changeangle-down(-0.00%) $0.00Current Price$1.00Price as of December 16, 2025 at 6:48 PM ETTether has had a long history of questionable transparency regarding its stablecoin, and investors should be aware of it.Tether (USDT 0.01%) is often in sync with Bitcoin as the largest cryptocurrency by trading volume, offering versatility as a "safe haven" during periods of high liquidity in the crypto market. With each USDT token pegged to a dollar, it's often considered one of the safest cryptocurrencies on the market. However, investors should watch one key risk. A large green sign of the word Tether. Tether's transparency is not as good as other stablecoins Tether Limited, the issuer of USDT, has faced long-running scrutiny over transparency, since 2017. Investigations by the New York Attorney General's office found that in 2017 and 2018, the company did not maintain a full 1-for-1 backing of USDT. During that period, Tether Limited was instead using reserve funds meant for backing USDT to help cover a financial shortfall at its sister company, Bitfinex. Both companies were later banned from conducting business in New York.
While Tether Limited has recovered from the findings, transparency remains a concern. The company uses offshore banking partners, including banks in the Bahamas, to hold portions of USDT's reserves. Offshore jurisdictions may have looser disclosure requirements than U.S. regulations, limiting operational oversight. USD Coin, by contrast, is considered a more transparent stablecoin. Its issuer, Circle, became a publicly traded company in June 2025 and is now subject to the disclosure requirements of the U.S. Securities and Exchange Commission (SEC). Circle is based in New York, known as one of the strictest states when it comes to crypto regulations. The company also reports USDC's full reserves monthly, compared to Tether Limited's quarterly report on USDT's reserves. ExpandCRYPTO: USDTTetherToday's Change(-0.01%) $-0.00Current Price$1.00Key Data PointsMarket Cap$186BDay's Range$1.00 - $1.0052wk Range$0.99 - $1.01Volume75B Be cautious with all stablecoins Ultimately, it's a trade-off between transparency and liquidity. USD Coin is the more transparent stablecoin while Tether remains more liquid, having significantly higher trading volume and twice the market cap.Advertisement That said, no stablecoin is completely risk-free. Stablecoins can de-peg from the dollar (rarely) due to market conditions, liquidity issues, and regulatory changes. Therefore, traders may sometimes receive less value in fiat currency when selling stablecoins. Investors should remain mindful of these factors when considering any cryptocurrency investment.Read NextNov 16, 2025 •By Leo SunBetter Stablecoin Buy: Tether (USDT) vs. Ripple USD (RLUSD)Oct 20, 2025 •By Lyle DalyBetter Stablecoin Buy: Ripple USD vs. TetherSep 16, 2025 •By Anders BylundBeyond USDT: Tether's New USAT Stablecoin Targets U.S. Market -- Should You Care?Sep 3, 2025 •By Leo SunBetter Stablecoin Buy: Tether (USDT) vs. USD Coin (USDC)Aug 25, 2025 •By Lyle DalyTether's USDT Remains the Dominant Stablecoin, but It's Facing Stiff Competition. Here Are 3 Contenders.Aug 8, 2025 •By Dominic BasultoThese Are the 5 Most Popular Stablecoins in 2025.
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