Coinbase Launches Tether (USDT) Trading After Compliance Delays

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On May 4, 2021, Coinbase, one of the most prominent U.S.-regulated cryptocurrency exchanges, officially launched support for Tether (USDT), allowing users to trade and transfer the world’s largest stablecoin by market capitalization. The rollout marks a significant milestone in the broader institutional adoption of stablecoins, especially given Coinbase’s compliance-focused reputation and recent public listing.

Currently, Coinbase supports only the ERC-20 version of USDT, meaning the token operates on the Ethereum blockchain. This move brings greater accessibility to retail and institutional investors who rely on Coinbase for secure and regulated digital asset trading.

👉 Discover how leading exchanges are integrating stablecoins for seamless trading.

A Long-Awaited Integration

The inclusion of USDT on Coinbase did not come easily. The exchange had delayed the listing twice due to compliance and technical concerns—a reflection of its cautious approach to regulatory scrutiny.

In May 2020, Coinbase Custody briefly announced support for ERC-20-based USDT. However, within a month, the announcement was quietly removed without official explanation. At the time, speculation pointed to internal compliance reviews and concerns over Tether’s controversial financial transparency practices.

Later in 2021, shortly after Coinbase’s historic Nasdaq direct listing, the company announced plans to list USDT. Yet, just days after the announcement, it postponed the launch again—this time citing API integration issues. These delays underscored the complexities involved in integrating widely used but scrutinized assets like USDT into a highly regulated platform.

Tether’s Evolving Reputation

Tether (USDT) has long been at the center of controversy within the crypto industry. Questions about its 1:1 USD reserve backing and lack of transparency plagued the company for years. However, a pivotal development occurred in February 2021 when Tether reached a settlement with the New York Attorney General’s office.

As part of the resolution, Tether agreed to pay an $18.5 million fine and committed to providing regular financial disclosures going forward. While not an admission of guilt, the settlement helped ease regulatory pressure and improved market confidence in the stability of USDT.

This shift in perception likely played a crucial role in enabling Coinbase’s decision to finally list the stablecoin. With increased transparency and ongoing audits, USDT has maintained its position as a cornerstone of crypto liquidity across global exchanges.

Why USDT Matters for Coinbase Users

Stablecoins like USDT serve as critical bridges between fiat currencies and volatile cryptocurrencies. They allow traders to hedge against price swings, facilitate faster cross-border transfers, and enable participation in decentralized finance (DeFi) applications—all without exiting the crypto ecosystem.

Before this launch, Coinbase supported only a limited number of stablecoins, most notably USD Coin (USDC), which is fully backed and highly transparent. While USDC remains a strong alternative, USDT’s dominance in trading volume and global usage made its absence notable.

Now that USDT is available, Coinbase users gain:

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Frequently Asked Questions

Why did Coinbase delay listing USDT?

Coinbase delayed the USDT listing twice—first due to internal compliance reviews related to Tether’s transparency issues, and later due to technical API challenges. As a regulated U.S. exchange, Coinbase prioritizes legal and operational safety over speed.

Is USDT on Coinbase safe to use?

Yes. Since Coinbase only supports the ERC-20 version of USDT, users benefit from Ethereum’s security model and transaction transparency. Additionally, Coinbase implements robust custody and anti-fraud measures for all listed assets.

Can I withdraw USDT from Coinbase to external wallets?

Yes. Users can send ERC-20 USDT from their Coinbase accounts to any compatible Ethereum wallet or decentralized application (dApp), provided gas fees are covered.

How does USDT compare to USDC on Coinbase?

Both are dollar-pegged stablecoins, but USDC is issued by regulated financial institutions and fully audited. USDT offers higher global liquidity and is more widely used in Asian markets and DeFi platforms. Investors often use both depending on their needs.

Will Coinbase add other versions of USDT (like TRC-20)?

As of now, Coinbase has only enabled ERC-20 USDT. There is no official announcement regarding support for other blockchain versions such as TRON-based (TRC-20) USDT. Future expansions will likely depend on user demand and compliance assessments.

Does listing USDT signal broader crypto adoption?

Absolutely. The inclusion of a previously controversial asset like USDT on a major regulated exchange reflects growing maturity in the crypto industry. It shows that even complex assets can be integrated responsibly with proper oversight.

👉 Explore how top platforms are shaping the future of digital asset trading.

Final Thoughts

Coinbase’s decision to list USDT—after years of hesitation—represents a turning point in the convergence of traditional finance standards and decentralized digital assets. It highlights how transparency improvements and regulatory clarity can open doors even for once-controversial projects.

For users, this means more choice, better liquidity, and stronger infrastructure for navigating the evolving crypto economy. As stablecoins continue to play a central role in global finance, integrations like this set a precedent for future asset listings across compliant exchanges.

With USDT now live on one of the world’s most trusted platforms, the line between regulated finance and decentralized innovation grows ever thinner—and more exciting.