Tether is the most popular stable coin and acts as a dollar replacement on many popular exchanges. A stable coin is a stable cryptocurrency that can be used as a digital dollar. A stable coin is attached to something that is real in world value. Tether uses open Blockchain technology platform and claims to be backed by 100% USD. The Tether was launched in 2015, and 1 USD is equivalent to 1 Tether. Tether limited company issues the digital coins. Its original name was 'real-coin,' it’s incorporated in Hong Kong with offices in Switzerland and it’s governed by British Virgin Island law. Tether target people trading in exchanges like Bitfinex to buy other cryptocurrencies like BTC.
USDT cryptocurrency asset is issued on BTC Blockchain via Omni layer protocol. USD base each USDT unit held on the reserve of Tether limited and is redeemable through Tether platform. USDT provide an alternative to prove of solvency method by introducing proof of reserve process. Holding fiat in exchange is very risky, using Tether expose exchange users to less risk than keeping fiat in exchanges. Tether claims using this method to buy virtual currencies allow users to move fiat in and out of exchanges fast and cheaper. Banks are wary of working with cryptocurrency exchanges, and both institutions have no close relationship, but Tether offers a stable alternative, offering low volatility of dollar to both exchanges and users. Tether allows crypto to crypto exchanges to price crypto assets in USD without basically having to own or maintaining USD by dominating bank accounts. It is advantageous to the exchanges considering the shortcoming they have with banks. Tether limited can use USDT to lock in returns during times of volatility and also transfers funds from one platform to another. Tether aims to facilitate the transaction between crypto exchanges with a fixed rate to USD dollar. Traders can also take advantage of arbitrage opportunities and high-speed transactions without resorting to bank wires
Tether has lived up its description as a stable coin. Whatever you can do with a digital currency you can as well do it with cash. Tether trading data occasionally is around $1 dropping as low as $0.8 and rising to $1.10. Tether is a substantial source of liquidity for cryptocurrency market; it seeks to bring stability and everyday utility of fiat currency and revitalize them with cryptocurrency infusion. If Tether collapse, it would be devastating for the market. Tether promise to back its own digital tokens called Tether with fiat currency.
Tether offers Blockchain companies, services in a variety of digital currencies. Reduction in operation cost and time by passing financial institution and also price services and goods in currency their customer are familiar with. Traders, on the other hand, can move currency seamlessly between exchanges and wallets. Be custodian of their fund and eliminate exchange custodianship. Engage in peer to peer decentralized network with the variety of commercial uses. They can also enhance their cross exchange and currency arbitrage strategy. Tether enable exchanges to deposit and withdraw currency. Exchanges can settle fiat balance between exchanges much easier and in real time. Exchanges can also manage user’s assets purely through cryptocurrency process, including multi-sig.
There are $2B worth of USDT in circulation today, instead of exchanges holding clients balance in dollar they hold them in USDT, so if users have their money on an exchange and they don't have any current open position they are probably in Tether.
- No transaction fee: Sending money from one Blockchain wallet capable of storing Tether or between two tether accounts is free. But transaction cost for converting Tether into fiat currency applies depending on institutions.
- Stability: Tether is stored in real-world currency. Users benefit from digital-based transactions without subjection from the volatility of most cryptocurrency.
- Transparency: Tether transaction are recorded on the public Blockchain. Tether claim its fiat reserve is regularly audited. Balance is regularly updated and is publicly accessible all the time.
- Widespread integration: It's the most integrated digital to fiat currency today. You can buy, sell and use Tether at Bitfinex, Gocoin, Shapeshift and other exchanges.
- Secure: Tether Blockchain technology delivers world-class security and has meetings with international compliance standards and regulations.
- Support both digital and fiat currencies: It has a combined benefit of open Blockchain technology and traditional currency.
- It’s the main source of liquidity in Cryptomarkets: Its trading volume regularly exceed that of market cap.
- Negative allegation throughout the Blockchain industry: Some cryptocurrency insiders claim Tether is being used to prop BTC price. Critics say whenever BTC price dropped a bunch of Tether token is spent on BTC to push it up.
- Negative Speculations: There is fear that if Tether collapse it would have a devastating effect on the broad cryptocurrency market especially BTC.
- Lack of USD reserve: There are claims that Tether limited do not hold enough USD to back all the digital coins in circulation. They say there is price manipulation due to the increasing number of coin circulation in the market.
- Has been hacked: Last year hackers snatched $31 Millions of tokens from the wallets of the company.
- Currently, no audit: Tether recently announced they had ended relations with Friedman LLP which was to prove USDT was fully backed.
- The uncertainty of who own Tether: Some claims it’s issued by Bitfinex exchanges.
- Lack of associated banking relation: Claim that Tether main problem could be a privation of appropriate financial transactions relation rather than lack of USD reserve.
How to buy:
Tether token can be purchased on many popular cryptocurrency exchanges like Bitfinex, Kraken. While the value of Tether is tied to USD, some exchanges do not offer direct USD/USDT. You will have to purchase BTC/ETH or any other cryptocurrency to trade Tether.
Tether has a trusted USDT wallet. All you need to do is choose your free wallet. The wallet is available in mobile applications for both Android and iOS. Vast assets are stored in cold storage while offline. If you lose your device, you can access or freeze your account from any other Android or iOS device. You can also secure your wallet by adding security code and verifying your phone number or email address.