Utexo relaunches USDT on Bitcoin using RGB protocol

Dubai-based startup Utexo will relaunch Tether’s USDT on the Bitcoin network using the RGB protocol on November 28. The move aims to reintroduce the stablecoin to Bitcoin after Tether ended issuance on the chain in August 2023. Lightning Network support for the new integration is expected to arrive in the first quarter of 2027.

Protocol Mechanics and Privacy

The relaunch relies on Tether’s USDT0 protocol. CEO Viktor Ihnatiuk states that speed and privacy are the primary differentiators for this new version. In this architecture, Bitcoin serves as the settlement layer, while the RGB protocol keeps transaction details off the public blockchain. Ihnatiuk claims that Lightning payments can settle in approximately 100 milliseconds.

RGB, which has been in development since 2016, allows users to issue and move assets through contracts tied to Bitcoin without publishing every detail on-chain. Participants validate transfers themselves, while cryptographic commitments anchored to Bitcoin provide security. The protocol is neither a sidechain nor a rollup. It works with Lightning, allowing USDT to move through payment channels without requiring a base-layer transaction for each transfer. Utexo argues that this confidentiality will appeal to businesses that prefer not to expose their counterparties on a transparent ledger. The company states it can selectively disclose data for compliance purposes and respond to law enforcement requests.

Bridge Risks and Market Goals

Utexo opened early access to its USDT Mint product on October 22. This phase allows verified exchanges, wallets, and market makers to test minting and redemption on Bitcoin’s Signet network. To move existing tokens onto Bitcoin, users must lock USDT0 on Arbitrum before an equivalent amount is minted on Bitcoin. Redemption reverses this process by burning the RGB asset. Consequently, security depends on the bridge as well as Bitcoin and RGB, a factor that introduces risk given that bridges have historically attracted hackers.

The project enters a market where roughly $300 billion in stablecoins already sit on Ethereum, Tron, and other networks. USDT first appeared on Bitcoin in 2014 through the Omni protocol. Tether ended issuance on that chain in August 2023, citing falling usage. The company later floated an RGB-based launch in 2025, but it never materialized. Tether led Utexo’s $7.5 million seed round in March.

Utexo has set a goal of at least $1 billion in Bitcoin-based USDT within 12 months. The median target is $5 billion, with an ambitious ceiling of $10 billion. Whether demand materializes at this scale remains the key test for the relaunch.