How does BTC USDT work?

Could you please explain how the BTC-USDT trading pair works? I'm a bit confused about the mechanism behind it. I understand that BTC is Bitcoin, but what exactly is USDT and how does it interact with BTC in trading? Is it a stablecoin pegged to the US dollar? And how does the pricing of this trading pair adjust in the market? I'm also interested in knowing about the liquidity and volatility of this pair. Could you provide some insights into its trading patterns and any risks involved? Thank you for your time and expertise.