Tether USDt
USDT#3USDT is the largest US dollar stablecoin, issued by Tether and meant to stay worth US$1.
- Market cap
- $184.06B
- Volume 24h
- $97.76B
- All-time high
- —
- Circulating supply
- 184.09B
Passes our Shariah screening. Needs caution: excessive uncertainty (gharar) and benefit and harm (maslahah). Fails: business model.
- 5 pass
- 2 caution
- 1 fail
Verdict history
- HalalCurrent
First publication
Fundamentals, market picture and news will appear here.
Halal analysis
Can a Muslim hold Tether USDt?8 Shariah criteria
5 pass · 2 caution · 1 failHolding USDT pays no interest: Tether keeps all income from its reserves, and holders can only redeem at face value.
Riba means interest, or any fixed increase on a loan or on an exchange of money. Tether's Terms of Service set redemption at one dollar per token, less fees, and give holders no interest, yield or share of profit. About 82% of the reserves do earn interest, but that income stays with Tether and is assessed under the business model criterion. Islamic Finance Guru, the first-priority authoritative source, makes the same point: although USDT is backed by interest-bearing instruments, its owner does not own a portion of a debt, and the reserve exists to support the token, not to pass debts on.
The US GENIUS Act also bars licensed and foreign payment stablecoin issuers from paying holders interest simply for holding. With no interest reaching the holder, the score is the maximum. If USDT is treated as money, exchanging it should follow the rules of currency exchange (bay' al-sarf: on the spot and at equal value); interest earned by lending USDT to others is covered under trading mechanisms.
USDT is a redeemable claim on a large, independently checked reserve; Islamic Finance Guru rates it permissible.
Each USDT is recorded as a liability that Tether must repay on demand. At 30 June 2026, US$187.75B of reserves stood behind US$183.64B of liabilities under BDO reasonable assurance, and KPMG has since given a clean audit opinion on the 2025 accounts. In May 2022 more than US$10B of USDT was withdrawn in about two weeks and the peg recovered.
Islamic Finance Guru, the first-priority authoritative source, rates USDT permissible, and Malaysia's SC Shariah Advisory Council recognises digital tokens as mal and classes currency-backed ones as currency (applying this to USDT is Liberandum's reading). A June 2026 fatwa from Darul Uloom Karachi, which mentions USDT by name, says crypto tokens are not mal, and state fatwa bodies in Egypt, the UAE, Indonesia and Turkey reject cryptocurrency in general. That is a dispute about crypto tokens as a whole rather than a defect of USDT, so it is reflected in confidence, and the score is the maximum.
USDT is built to stay at US$1, not to be bet on.
Maysir means gambling, or gains that depend purely on chance; ordinary price movement is not maysir. USDT's largest fall over the past year was 0.34%, so it is not held to profit from price swings. It is used to move and settle dollars: Chainalysis estimated about US$703B of USDT transfers per month between mid-2024 and mid-2025. USDT is also heavily used on exchanges, including as collateral for leveraged trading. That is a problem of those trading products, assessed separately below, not a gambling feature of the token itself. With no gambling feature in the token, the score is the maximum.
Tether's income comes mainly from interest on Treasury bills, repo agreements and secured loans, far above the 5% limit on impermissible income. This is the main point of dispute.
This criterion looks at how the company behind a token earns. If 5% or more of its income comes from clearly impermissible sources such as interest, the criterion fails. At 30 June 2026 about 82% of USDT's reserves were in interest-bearing assets: US Treasury bills (61%), reverse repo agreements (14%) and secured loans (7%). Tether publishes profit, not revenue by source. In 2024, the latest year with a split, Treasuries and repo produced about US$7B of US$13B profit (about 54%, or about 88% excluding unrealised gold and bitcoin gains).
Tether says its Q2 2026 operating profit of about US$1.5B was led by Treasuries and repo, and in September 2026 it co-sponsored a private credit fund. On every available measure interest is far above 5%. The counter-view is serious: holders receive none of this interest, and Islamic Finance Guru rates USDT permissible for that reason, noting that holders do not own a share of the debt. The test still applies to the issuer's income, because the reserve behind every token is run to earn interest.
- Halal crypto list (Islamic Finance Guru)
- BDO ISAE 3000R report: Tether International Financial Figures and Reserves Report, 30 June 2026
- Tether hits $13 billion profits for 2024 (Q4 2024 attestation)
- Tether posts strong Q2 performance, generates $1.5B net operating profit, maintains $4.11B reserve buffer
Reserves are checked quarterly and now audited, but parts of them are opaque and the safety buffer is thin.
Gharar means excessive uncertainty or lack of transparency in a deal. Tether publishes quarterly reserve reports checked by BDO, and KPMG gave a clean opinion on its 2025 accounts, so this is not a case of reserves moved without disclosure. But BDO checks only a single day each quarter. The borrowers, rates and collateral behind US$13.45B of secured loans are not disclosed, and US$5.24B of 'other investments' are not described. About 25% of reserves sit outside cash and cash equivalents, including gold and bitcoin, against an equity buffer of 2.24%.
S&P rated USDT's stability 5 ('weak'), its lowest level, in November 2025. Tether can freeze tokens at its discretion. In 2021 US regulators fined it over past claims about its backing.
USDT is used mainly to hold, move and settle dollars, including on exchanges; the share of disputed uses is not measured.
USDT's main uses are permissible in themselves: transfers, remittances, dollar access in emerging markets and spot trading. Chainalysis links emerging-market adoption to remittances and dollar access via stablecoins. In a sample of the largest bitcoin spot markets on 16 September 2026, USDT was the pricing currency for about 80% of volume. USDT is also lent for interest on DeFi platforms (about 3% a year) and used as collateral for leveraged trading, which are impermissible uses.
Those impermissible uses are documented, so the score is lowered within pass; no source measures their share, which is recorded as a data gap. Misuse for scams and sanctions evasion is weighed under benefit and harm.
USDT can be bought outright and held in full, on exchanges or directly from Tether.
This criterion asks only whether the token can be owned in a normal, fully paid way. USDT is widely available for spot purchase, and verified customers can buy and redeem directly with Tether at US$1, with a US$100,000 minimum and 0.1% fees. Holders can keep it in their own wallets on Tron, Ethereum and other networks. It does not exist only as a leveraged or derivative product. Access varies by country: EU-licensed platforms may not offer it, and Tether's own services exclude most US persons. Permissible ownership is fully available, so the score is the maximum.
USDT gives millions of people dollar access, but it is also the main token in scam and sanctions-evasion flows.
Maslahah means weighing public benefit against harm. The benefit is real: USDT gives cheap, fast dollar access and remittances, especially in emerging markets. The harm is significant too. Stablecoins made up 84% of illicit crypto volume in 2025 (Chainalysis), and TRM Labs says USDT and Russia's A7A5 made up most inflows to sanctioned entities, with Tron a key settlement chain. Harm does not dominate: illicit activity was about 1% of all crypto volume, and Tether reports freezing over US$5B linked to crime in more than 2,800 cases with 340+ agencies. Those freeze figures are Tether's own.
How you can use it
Tap a card for the ruling and sourcesUSDT can be bought on the spot almost everywhere, with full and immediate settlement. Spot purchase is acceptable for an asset rated HALAL or DOUBTFUL, and USDT is rated HALAL. If USDT is treated as money, as in the SC Malaysia classification on Liberandum's reading, the exchange should also follow the rules of currency exchange (sarf): hand to hand, and at equal value when exchanged for dollars.
Not available: there is no exchange-traded fund that holds USDT. A fund that simply held USDT would be judged like spot, but its structure (no interest income, no lending of the USDT) would need a separate check, so this stays at caution.
Paying with USDT is technically easy, but tier-1 bodies prohibit crypto as a means of payment: Indonesia's MUI holds that using cryptocurrency as currency is haram. In the UAE a foreign dollar stablecoin may legally be used only to buy virtual assets, not goods or services. Check local rules before paying with USDT.
Not available natively: USDT is not a proof-of-stake coin, so there is no validation work to be paid for. Products marketed as "USDT staking" pay returns from lending USDT out, which is interest (riba), so they fail just as lending and yield products do.
Always fail: borrowing to trade with leverage, without full delivery. USDT is commonly used as margin collateral on exchanges.
Always fail: futures, perpetuals and options are deferred exchanges without delivery, with leverage. USDT-margined contracts fall here.
Lending USDT for a return is interest on a loan of money (riba). On 16 September 2026 DeFi platforms such as Aave and Compound paid about 3% a year on supplied USDT.
Tether pays holders nothing. "Earn" and savings products on USDT get their return from lending it out, which is interest.
Scholars quotes
The opinion on this is the same as doing the same with any halal assets such as shares – 1) is permissible, 2) is more debatable and there are differing opinions on short-term trading.USDT can be used for Shariah-compliant transactions, provided that the transactions themselves adhere to Islamic principles.As I mentioned at the beginning of this article it is not necessary to substantiate the permissibility of something as long as there are no prohibited factors involved in it or surrounding it.Penggunaan cryptocurrency sebagai mata uang hukumnya haram, karena mengandung gharar (ketidakjelasan), dharar (bahaya) dan bertentangan dengan Undang-Undang nomor 7 tahun 2011 tentang Mata Uang dan Peraturan Bank Indonesia nomor 17 tahun 2015 tentang Kewajiban Penggunaan Rupiah di Wilayah Negara Kesatuan Republik Indonesia.Sebagaimana mata wang yang lain, mata wang digital hendaklah tidak digunakan sebagai bayaran kepada barangan, perkhidmatan dan aktiviti tidak patuh Syariah seperti pembelian dadah, pelacuran, perjudian dan pendanaan aktiviti keganasan serta penggubahan wang haram.If a digital currency is backed by ribawi items comprising gold, silver and currency, it is categorised as a currency from Shariah perspective. Hence, the trading of such digital currency is subject to the principle of bai` al-sarf.Third: In light of the above and given the significant risks associated with this type of currencies and the instability of their transactions, the Council of the Academy recommends pursuing research and studies on issues affecting its ruling.Bitcoin is a digital currency that does not meet the legal and Sharia criteria that make it a currency subject to the rulings of dealing with official legal currencies recognized internationally.بناءً على ذلك: فلا يجوز شرعًا تداول عملة "البتكوين" والتعامل من خلالها بالبيعِ والشراءِ والإجارةِ وغيرها، بل يُمنع من الاشتراكِ فيها؛ لعدمِ اعتبارِها كوسيطٍ مقبولٍ للتبادلِ من الجهاتِ المخُتصَّةِ، ولِمَا تشتمل عليه من الضررِ الناشئ عن الغررِ والجهالةِ والغشِّ في مَصْرِفها ومِعْيارها وقِيمتها، فضلًا عما تؤدي إليه ممارستُها من مخاطرَ عاليةٍ على الأفراد والدول.According to research and opinion of experts so far, cryptocurrency is not considered ‘ maal ’ (wealth) in Sharia.Muhammadiyah memandang transaksi dan investasi kripto pada dasarnya mubah (boleh) tetapi dengan syarat tertentu.Our current position is 'tawaquf'; we can't say it is halal or haram, but we say it is better not to engage in itFiat-backed stablecoins are generally considered permissible, fully backed by the underlying currency or not, as long as this information is transparently disclosed to the users.AI-assisted analysis checked against sources. Not a fatwa or investment advice.
Where it trades
Section in preparation
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