Stablecoins were created to solve a simple problem: people wanted the speed of cryptocurrencies without the constant price swings. These tokens track the value of the dollar and are now used for everything from sending money abroad to parking funds during market turmoil. But not all dollar tokens work the same, and that becomes obvious when comparing Tether (USDT) to Ripple USD (RLUSD).
Below is a closer look at how each one is built, where they fit into the world of cryptocurrencies, and the type of user each one really suits.
Tether: the most used dollar token in cryptocurrencies
USDT has been around since 2014 and has become the dominant digital dollar on exchanges and trading platforms. Tether Limited, the company that issues it, originally launched USDT on the Bitcoin network and later expanded it to Ethereum and other chains. That early expansion is one of the main reasons traders use it to move money between exchanges and for DeFi activities.
Tether’s growth also comes from convenience. It is available on almost all major blockchains, so users rarely worry about compatibility when moving funds.
However, Tether’s support has been debated for years. The company holds a mix of cash, U.S. Treasuries and other short-term assets. It publishes reserve breakdowns but has not yet undergone a full independent audit, something critics often point out. This lack of complete transparency has not prevented its adoption, but it remains an issue that resurfaces periodically.
Vibe USD: a newer dollar token with a more limited role
Ripple USD started in 2024 and was created specifically for the XRP Ledger. Unlike USDT, RLUSD is not issued by a single company. Instead, they are created as promissory notes by different portals (platforms like Bitstamp or GateHub) that hold real dollars in their accounts to back the tokens they distribute.
This structure is part of how the XRP Ledger was originally designed. Instead of a central issuer, value comes from gateways that users choose to trust. The method works well within Ripple’s payment system, especially when institutions need to quickly convert one currency into another. RLUSD often acts as the intermediate step for these transfers.
But this model also has a trade-off: your risk depends on the gateway you’ve selected. If a gateway mismanages its cash reserves, users holding its IOUs could lose funds. It is similar to keeping money in a small financial institution that is not protected by insurance programs.
Because RLUSD primarily lives within the XRP Ledger, it has not spread to major blockchain ecosystems. Most traders outside of the Ripple network simply have no reason to use it.
What is the best purchase?
RLUSD works well for institutions that are already tied to the Ripple system, especially those that rely on the XRP Ledger to move money between currencies. Its use is mainly limited to that environment.
USDT plays a much larger role in the overall crypto market. It moves across many blockchains, is supported by almost every major exchange, and is the stablecoin that most traders deal with on a daily basis. Because of that reach, USDT is the option that suits more buyers looking for a dollar token they can use anywhere.
Also read: Litecoin, Solana and Chainlink stand out among US cryptocurrencies this week