Tether relaunches USDT on Bitcoin via startup Utexo

Tether’s USDT, the largest stablecoin with a circulating supply of $184 billion, is set to relaunch on Bitcoin this month after first appearing there a decade ago. The rollout arrives as US lawmakers continue to question whether Tether can adequately monitor the tokens it has already issued on other networks.

• USDT returns to Bitcoin via a startup called Utexo, which raised $7.5 million in a round led by Tether.
• About $92 billion of USDT sits on Tron and $74 billion on Ethereum, over 90% of total supply combined.
• Tether has previously frozen $550 million in USDT tied to sanctions-evasion concerns raised by US senators.

• $184B total USDT in circulation, the largest stablecoin by market value
• $92B USDT held on Tron, roughly half of all coins issued
• $74B USDT held on Ethereum, the second-largest network by supply
• $550M USDT Tether has frozen amid sanctions-evasion scrutiny from senators

Tether’s stablecoin is heading back to its original blockchain home more than ten years after USDT first launched on Bitcoin through the now-retired Omni protocol. According to reporting by BeInCrypto, the new Bitcoin-based version promises private payments, with most transaction details kept off Bitcoin’s public ledger. The relaunch lands at a moment when Washington is pressing Tether over oversight of the coins it has already issued on other chains.

Utexo’s RGB system brings USDT back to Bitcoin this month

For existing holders, nothing changes immediately. Tether framed the move as an expansion of its Bitcoin support rather than a migration away from other networks.

Tether CEO Paolo Ardoino laid out the plan in a 2025 announcement, promising exchanges and wallets access to private transfers, Bitcoin-to-USDT swaps, and Bitcoin-backed loans. He wrote on X that the project represents USDT “coming home” to the network where it began.

USDT on Bitcoin. It’s coming home.

Paolo Ardoino, CEO of Tether, in a post on X

Ardoino had earlier argued that Bitcoin needed a stablecoin that felt “truly native, lightweight, private, and scalable.” The underlying technology is RGB, a protocol that issues tokens such as USDT on Bitcoin while keeping payment details between sender and receiver, with only a small digital fingerprint recorded on-chain. The rollout belongs to Utexo, which raised $7.5 million in a round led by Tether and recently secured a commercial license to issue the coin, according to co-founder Viktor Ihnatiuk.

Tron and Ethereum still carry more than 90% of USDT supply

Tether’s 2025 announcement makes no mention of withdrawing USDT from Tron or Ethereum. Today, roughly $92 billion of USDT sits on Tron, close to half of all coins in circulation, with another $74 billion on Ethereum, according to data from DefiLlama. Together the two networks still account for more than 90% of total USDT supply, leaving the Bitcoin version a small fraction of the overall market by comparison.

Tether has dropped networks before. In September 2025 it ended support for five older systems, including Omni, the original Bitcoin-based protocol USDT launched on in 2015.

Rather than replacing the existing chains, the Bitcoin version draws from them. Utexo’s bridge, a tool for moving coins between networks, pulls USDT mainly from Ethereum and Tron, according to the RGB Protocol Association. The token itself remains pegged to the dollar regardless of which network it travels on, though exchanges already require users to select the correct network before sending funds, since a mismatch can mean losing the coins entirely.

Morgan Stanley talks precede a slipped launch timeline

Freezing remains Tether’s central response to compliance critics. When US senators alleged that Iran uses USDT to evade sanctions, Tether pointed to the $550 million it had already frozen. On Tron and Ethereum, every transfer sits on a public ledger that investigators can trace, but the RGB version on Bitcoin hides most of that trail, and Tether’s announcement does not explain how freezes would work on the new network.

Utexo has brought in blockchain-tracking firm Crystal Intelligence for compliance support, according to the RGB Protocol Association. Ihnatiuk has also played down the privacy angle, describing RGB as “mainly just a token standard, one that also brings you privacy, but that’s more of a side feature,” per the RGB Protocol Association.

Ihnatiuk said this week he met with Morgan Stanley in Washington to discuss Utexo’s work on USDT for Bitcoin, including a conversation with Morgan Stanley’s Mergner and other team members. The launch has already slipped past a mid-September window Utexo once called realistic, and support for the Lightning payment network will not arrive until after the initial rollout. Until wallets and exchanges activate it, USDT on Bitcoin has nowhere to move.

The BlockWest read. The real signal here is not privacy, it is distribution. A Morgan Stanley meeting suggests Utexo is courting institutional rails before retail adoption exists, which matters more to allocators than RGB’s technical design. Until custodians and exchanges list the Bitcoin-native version, this stays a compliance and infrastructure story, not a liquidity shift away from Tron or Ethereum.

Utexo has not set a confirmed public launch date after missing its mid-September target, and Lightning network support will only follow the initial rollout. Whether Morgan Stanley’s discussions with Ihnatiuk translate into institutional custody or trading support for Bitcoin-based USDT remains an open question.

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