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Tether, the issuer of the world's largest stablecoin, has announced plans to integrate its USDt token into Bitcoin's base layer and Lightning Network, a significant development in the convergence of dollar-pegged assets with Bitcoin infrastructure.
The integration, revealed at the Plan ₿ Forum in El Salvador, will utilise Taproot Assets, a new protocol developed by Lightning Labs that leverages Bitcoin's Taproot upgrade to enable token functionality while maintaining the network's decentralised architecture. In its announcement, Tether stated, “This integration delivers a scalable, seamless payment solution, powering the AI economy and unlocking new use cases, including microtransactions, remittances, and efficient cross-border settlements.”
Tether announcement
Paolo Ardoino, CEO of Tether, outlined the strategic importance of the move: "Tether is committed to driving innovation in the Bitcoin ecosystem. By enabling USDt on the Lightning Network, we are not only reinforcing Bitcoin's foundational principles of decentralization and security but also creating practical solutions for remittances, payments, and other financial applications that demand both speed and reliability."
The development could significantly impact USDt's utility, as it will allow Tether's 350 million users to transact using Bitcoin's layer-2 Lightning Network, potentially enabling faster and cheaper transactions compared to existing blockchain networks.
Elizabeth Stark, CEO of Lightning Labs, stated: “Today marks a new era for stablecoins. Bringing USDt to Bitcoin combines the security and decentralization of Bitcoin with the speed and scalability of Lightning. Millions of people will now be able to use the most open, secure blockchain to send dollars globally. It all comes back to Bitcoin.”
Tether and Lightning Labs have indicated they will continue their collaboration to support developer adoption and ecosystem growth. The announcement, made in El Salvador, reflects the country's ongoing efforts to position itself as a hub for Bitcoin innovation since adopting the cryptocurrency as legal tender in 2021.
