The company and the token
USDT is a token. Tether is a group of companies that issues it, and the two are not interchangeable. The CFTC's 2021 order names four: Tether Holdings Limited, Tether Limited, Tether Operations Limited and Tether International Limited. The current terms name the counterparty as Tether International, S.A. de C.V., and record that it "has redomiciled from the British Virgin Islands to the Republic of El Salvador", announced on 13 January 2025 after a Digital Asset Service Provider licence was obtained there. Those terms are still governed by British Virgin Islands law, so it is a change of domicile rather than a clean break.
Why it is in a Bitcoin directory
The connection is real and narrower than the company's size suggests, so it is worth stating exactly. Tether's own FAQ says the token "was originally created to use the Bitcoin network as its transport protocol", specifically the Omni Layer, which put the first tethers on Bitcoin itself. That is the origin rather than the present: Omni is not among the chains Tether now lists, though Liquid is, and Liquid is a federated sidechain pegged to bitcoin.
Otherwise the connection is market structure, not protocol. USDT is the asset most bitcoin trades are priced in, which makes it part of the plumbing whether or not it is part of Bitcoin. It is listed on that basis, and this section exists so that nobody reads the listing as a claim that Tether is a Bitcoin project. It is not.
What it does
Issues a token intended to hold a value of one US dollar, redeemable against reserves the company holds. The question that has followed it since 2014 is the same each time: what is in the reserves, and who has checked. Tether runs a transparency page with tokens in circulation and a "Reports & Reserves" section, and states there that all tether tokens are "backed 100% by Tether's Reserves".
On the record
Two settled actions, both in 2021, neither admitted.
The New York Attorney General's February 2021 settlement agreement found that Tether had made false statements about the backing of the tether token, including publishing a verification of cash reserves in 2017 when the cash had been placed in the account that same morning. Bitfinex and Tether paid USD 18,500,000 and agreed to quarterly reporting and to public disclosure of the categories of assets backing tethers. The agreement records that they "neither admit nor deny the OAG's findings".
In October 2021 the CFTC issued an order finding that Tether violated Section 6(c)(1) of the Commodity Exchange Act and Regulation 180.1(a)(2) by making untrue or misleading statements about its reserves between June 2016 and February 2019. The order finds that Tether held sufficient fiat reserves for only 27.6 per cent of the days in a 26-month sample, that it included unsecured receivables and non-fiat assets, and that it had not completed an audit. The penalty was USD 41 million. Tether consented "without admitting or denying any of the findings or conclusions".
No court has adjudicated a fraud claim against Tether. Listing here is not endorsement.