$USDT ✅ What’s good / What still works for USDT
Dominant stablecoin & wide adoption — USDT remains the largest stablecoin by far, with a market capitalization north of US$ 180 billion.
Deep liquidity & marketplace integration — Because USDT is used as “base-currency” for many trading pairs, exchanges, DeFi protocols and cross-chain bridges rely heavily on it. That means it remains extremely liquid and widely accepted across blockchains.
Peg functionality generally holds — For now, despite turbulence in crypto markets, USDT continues to trade very close to its $1 peg. Arbitrage & redemption mechanisms help keep supply and demand balanced.
⚠️ What’s concerning / What’s risky for USDT now
Downgrade by a major rating agency — Just now (Nov 2025), S&P Global Ratings downgraded USDT’s “ability to hold dollar peg” to its weakest rating (“weak”). They cited increased exposure of USDT reserves to volatile or risky assets (like crypto, corporate bonds, loans, gold) and lack of transparency.
Reserve asset mix concerns — The inclusion of items such as cryptocurrency (e.g. Bitcoin), corporate bonds, secured loans and gold in reserves is worrisome because their values are not stable — so large price drops in these could threaten USDT’s backing integrity.
Regulatory and compliance pressure rising — New regulations (especially in major markets like the U.S. or Europe) increasingly demand fully backed, transparent stablecoins. USDT’s reserve composition and transparency issues may create headwinds under upcoming regulatory frameworks.
Potential de-peg / confidence risk in stress scenarios — Because backing includes volatile assets, during a broad crypto-market crash or financial stress — when many holders may rush to redeem — USDT might face strain. That could trigger de-pegging pressures or redemption delays.
