The T1 twisted pair is a balanced transmission line, which means each current (signal) carrying
conductor is at the same potential with respect to ground. The DS3 coaxial transmission line is an
unbalanced transmission line where the shield and center conductor are at different potentials
with respect to ground. In both cases, both conductors carry some portion of the signal. The
reason to ground only one end of the shield on a balanced (T1) signal carrying cable is to drain
off outside interference without providing a second ground path or loop. Multiple loops will
cause different potential and cause problems with signal integrity.

T1 twisted pairs further help reduce the probability that one of the twisted-pair conductors will
have more noise than the other, thus reducing what’s called “common mode” noise.

On a coax connection, the signal is unbalanced. You can look at the driver circuit as the
secondary of a transformer with one side connected to the shield and the other side connected to
the center conductor. You must have the shield and center conductor connected on both ends,
since your signal travels on both. The coaxial conductor requires the shield on both ends of the
cable to be the same, because it is the required reference point for determining a one or a zero. So
in the coax mode, ground loops don’t count since the same potential at each end is needed to
maintain a good BER (bit error rate).

You can expect that two pieces of equipment with a DS3 coax connection between them to have a
good ground connection. Only ground one side of the T1 twisted-pair shield. Doing otherwise, in
either case, is looking for transmission trouble.