What is the Best Stablecoin in 2023? USDT vs USDC vs BUSD

Since cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) are not as stable as normal currencies, you may find yourself in need of a currency you can easily hold when the crypto market isn’t stable. It’s similar to how you would probably hold USD savings instead of Naira, to stay ahead of the unstable exchange rate. Tether (USDT), USD Coin (USDC), and Binance USD (BUSD) are the three biggest stablecoins in the crypto market right now. In this article, we’ll explain their similarities and differences to help you decide which is the best stablecoin to choose. 

What is a Stablecoin? 

Stablecoins are cryptocurrencies with values tied to real-world assets such as:

  • Fiat currencies – like the US dollar, British Pound, Nigerian Naira, etc.
  • Alternative assets – like gold, oil, silver, etc. 
  • Cryptocurrencies 

They offer a way to remain stable when trading, reduce investment risks and even protect the value of your money from inflation.

Today, one of the biggest problems facing cryptocurrencies is price swings. You can see a cryptocurrency’s value rise as much as 20% in a single day – and it can also fall by as much too. While this is great for making a profit, it might not be what you’re looking for at the time. 

Stablecoins solve this problem since they are tied to normal currencies and these currencies don’t move as much as cryptocurrencies.

What to Know About Stablecoins 

  • A stablecoin’s value usually equals the value of the asset backing it. 
  • Stablecoins can also be used to store value or send money. 

Typically, a company that creates and runs a stablecoin has a reserve where they store the actual item backing the stablecoin. For example, USDT is backed by dollars so there should be $1 somewhere for every 1 USDT that exists. 

According to Coincodex, stablecoins’ market cap is currently $150.67 billion in 2022, making up 16.23% of the total cryptocurrency market cap. And the increasing popularity of this cryptocurrency class is due to its quick processing speed, security, and stability. 

What are Stablecoins Used For? 

Like other cryptocurrencies, stablecoins have real use cases that make them important to the crypto ecosystem. Here are some stablecoin use cases:

1. Saving Money

People looking for a safe way to store money outside the traditional banking system can choose stablecoins. This way, they don’t have to deal with fees or the banks monitoring their transactions. 

2. Payments

Like other cryptocurrencies, stablecoins allow people to send money easily. You can send money to a friend or family member abroad in just a few minutes. And, the best part is that, unlike traditional cryptocurrencies, the value of the money you send won’t change. 

If you own a business in Nigeria, you can also receive instant payments from the United Kingdom without having a UK bank account. And, you can exchange the coin for normal currencies like Naira or US dollars on a cryptocurrency exchange like Quidax. 

That way, you’ll avoid bank issues or international transaction charges that are relatively expensive. You also save the time you would rather spend going to the bank for foreign exchange  

3. Hedge Against Inflation 

Right now, inflation is a huge problem around the world. It devalues your money, leaving you with less over time. 

If you’re on social media, you may have heard people advising Nigerians to save in dollars. However, not everyone understands how to go about this. At the same time, dollars aren’t readily available to the average Nigerian. Although you can still save in dollars on Quidax and earn up to 10%, USDT is another short-term option to protect the value of your money. 

But with stablecoins like USDT and USDC, you can actually convert your naira to dollar-backed tokens by buying these cryptocurrencies on an exchange.

4. Crypto Trading 

Stablecoins are also cryptocurrencies that users can trade and invest in. 

Usually, stablecoins are used to facilitate trades on cryptocurrency exchanges. Both USDT and USDC are popular trading pairs on exchanges and DeFi platforms. For example, if you want to buy Bitcoin with US dollars on an exchange, you don’t need to have a physical USD account. Instead, you can buy a USDT and make the purchase by swapping your stablecoin for the equivalent amount of BTC it can purchase. 

5. Decentralized Finance

DeFi platforms offer a blockchain-based alternative to traditional banking. They allow users to enter smart contracts and invest in stablecoins. 

Staking is one of the common ways to invest in stablecoins through DeFi. When you lock up a portion of your coins on an exchange for a specific period, the exchange will reward you with free crypto for adding liquidity to the market. That way, you can earn passive income without having to trade cryptocurrencies. 

Some DeFi platforms also allow users to invest in stablecoins through lending and borrowing. As in centralized finance, this involves a lender giving a loan to a borrower for a certain period.

Eventually, the borrower pays the debt with interest, and the lender gets their money back with an incentive. That way, the lender makes more money. 

What Are the Major Stablecoins?

Tether (USDT), USDCoin (USDC), and Binance USD (BUSD)are the largest and most popular stablecoins today. They are pegged to the US dollar and are worth $1 each. Now, let’s dive into more details on each of these coins. What’s the deal with them and why does crypto trading seem to revolve around them?

What is USDT?

  • Tether (USDT) is a fiat-backed stablecoin. USDT was created in 2014 by the company Tether Limited Inc. It was the first stablecoin to be created, and it remains the most valuable one today. 
  • It was created to provide an easy and affordable way to send and receive money. Eventually, Tether added use cases of cryptocurrencies for payments, etc. In addition, USDT provides a secure way for merchants to accept fiat-based cryptocurrency payments without the fear or risk of price swings.
  • According to CoinMarketCap, USDT has a total market cap of $68,453,600,57 right now, making it the world’s largest stablecoin. USDT is available on major exchanges today. If you’re looking to buy USDT in Nigeria, Quidax offers a simple way to buy, store, or invest in USDT in one place. 

What is USDC?

  • USD Coin (USDC) is another stable coin tied to the US dollar. USDC was founded in 2018 by Circle – a financial services company – and Coinbase. People can use USDC to store their money or carry out financial transactions.  
  • USDC’s market cap is $43,931,678,916 right now, making it the second-largest cryptocurrency stablecoin by market cap. 
  • USDC is available on major digital exchanges and cryptocurrency platforms today. Interestingly, Quidax offers you a safe, secure, and easy way to buy USDC in Nigeria. 

What is BUSD?

  • Binance USD (BUSD) is also a fiat-backed stablecoin crypto that offers people a more accessible alternative to buying and using the US dollar. It was created by Binance and Paxos in 2019.
  • Like the stablecoins mentioned above, BUSD is also backed by the US dollar. That means its value is the same as the USD in a 1:1 ratio. Similarly, BUSD is a great alternative for crypto traders and investors looking for a more stable way to buy, sell, and invest in cryptocurrencies. 
  • Binance provides stability for BUSD by storing its equivalent amount in a bank account insured by the Federal Deposit Insurance Corporation (FDIC) and also backs it with treasury bills. 
  • BUSD has a market cap of $21,645,726,412 at the time of writing. Binance claims that the stablecoin is available on more than 30 exchanges, and over 20 crypto wallets support the stablecoin. 
  • Like other stablecoins, BUSD is listed on Quidax for traders who want to buy BUSD in Nigeria or invest in the stablecoin. 

USDT Vs USDC Vs BUSD: The Major Differences 

As stated earlier, this article aims to establish the similarities and differences between the world’s most popular stablecoins today. We highlight the differences below:

Stablecoin/Parameter USDT USDC BUSD
Market rank 3rd  4th 7th
Popularity 1st 2nd  3rd
Creation year 2014 2018 2019
Issuer  Tether Limited Inc. Circle & Coinbase  Binance & Paxos
Available blockchains 10 8 30+
Collateral Over $70 billion  Over $40 billion Over $20 billion
Tied-currency USD  USD  USD

Note that USDT, USDC, and BUSD also have their own blockchains where transactions are processed and recorded. 

Benefits of USDT, USDC, and BUSD

USDT, USDC, and BUSD are all popular stablecoins with similar features. They offer crypto traders and investors a more stable alternative to trading and investing. They also help reduce the risk of instability that you’ll typically see with other cryptocurrencies like Bitcoin and Ethereum. But there’s more to these stablecoins. 

USDT, USDC, and BUSD provide traditional financial services to users via blockchain technology. The stablecoins also tend to be stable at $1, so people who live in countries where inflation is a problem can easily access and store their funds in USD using these stablecoins. 

Other benefits of stablecoins include:

  • Low fees 
  • Regulation advantage 
  • Stability 
  • Easy cross-border or international payments

Which Stablecoin Should You Choose? 

Apart from the three stablecoins reviewed in this article, there are hundreds of more stablecoins. These include:

  • Dai (DAI) 
  • TrueUSD (TUSD) 
  • Pax Dollar (USDP) 
  • Gemini Dollar (GUSD) 
  • Tribe (TRIBE), and many more. 

Each stablecoin has its offerings and benefits, so choosing one can be a difficult task for even the most experienced crypto traders and investors. To decide which is the best stablecoin for you, you should consider the coin’s reputation, price history, and how many exchanges support it.

The Coin’s Reputation 

In terms of reputation, USDT, USDC, and BUSD are the best stablecoins today. They have the largest share of the market cap and are available on various cryptocurrency exchanges including Quidax. 

Price History 

Usually, stable coins are pegged to the US dollar in a 1:1 ratio. But some stablecoins like TerraUSD (UST) have shown that stablecoins can lose their pegs. In May 2022, UST’s price fell from $1 to 35 Cents. Eventually, investors panicked withdrew their UST funds, and the Terra network crashed.

Unlike Terra – which was an algorithm-backed stablecoin – USDT, BUSD, and USDC are backed by the US dollar. These stable coins are more reliable because they are pegged to the US dollar, which is a stable fiat currency. 

Supported Exchanges

Another thing to consider is the exchange that lists each stablecoin. The three stablecoins are available on major exchanges across the world. But you should bear in mind that fees vary by exchange. Some exchanges are also more secure and seamless than others. So, it’s best for you to choose reputable exchanges with low fees and high liquidity. 

At Quidax, we offer you a reliable and easy way to buy and save your naira in stablecoins. We make buying USDT, BUSD, USDC simple, and you can do this in just a few clicks. 




Other Questions You May Have

Should I buy USDT or USDC?

USDT and USDC are popular stablecoins. They are both pegged to the US dollar and offer a safer way to buy and invest in cryptocurrencies. 

USDT is more popular and used for trading. But, USDC is often referred to as the safer stablecoin because of its frequent audits and strict regulation by the government. Users consider USDT as the better trading option and USDC as the better store of value.  

Can I buy USDT in Nigeria?

You can buy USDT and other stablecoins in Nigeria on Quidax. All you have to do is sign up, fund your wallet, and buy USDT with a few clicks. 

Can USDT protect my money? 

USDT isa great way to protect your money from inflation and devaluation. It is pegged to the US dollar, making it easier for you to access the US dollar through crypto. 


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