What Is Tether (USDT)?
Stablecoins, are powerful players in the cryptocurrency market, and have been getting lots of attention recently. For years , questions regarding Stablecoins, particularly Tether, have been circulating in financial circles; are they as stable as they should be?
What is Tether ?
Tether issues one of the most popular and widely used cryptocurrencies on the crypto market, a stablecoin called tether (USDT).
Tether was launched as RealCoin in July 2014 and was rebranded as Tether in November 2014. It started trading in February 2015.23 Originally based on the Bitcoin blockchain, Tether now supports Bitcoin’s Omni and Liquid protocols as well as the Ethereum, TRON, EOS, Algorand, Solana, OMG Network, and Bitcoin Cash (SLP) blockchains.
Tether the protocol is closely connected to the crypto exchange Bitfinex as it shares the same parent company, iFinex Inc., which was founded in 2012 in Hong Kong and is registered in the British Virgin Islands.
How does Tether function ?
Tether is based on something called the Omni layer. This is a meta-protocol built on top of the Bitcoin blockchain that allows projects to create and trade their own currencies. Tether tokens started to be issued on Omni software layer for the Litecoin blockchain in the summer of 2017.
There are also Ethereum-based Tethers built using the ERC-20 standard.
What’s so unique about Tether?
Stable — Tether claims to be backed by fiat currency. That means holders aren’t subjected to the same high levels of volatility found in other cryptocurrencies. It gives users easy access to the cryptocurrency market, without exposure to wild price fluctuations.
Accepted World Wide— Tether is a popular cryptocurrency that can be bought and sold on most exchanges. Many exchanges use it as a trading pair.
Popular — Being backed by international currencies makes Tether’s value intuitive; useful for traders purchasing other cryptocurrencies with it.
Summary
Tether has proven itself to be a useful tool for the cryptocurrency community, with investors quick to buy in downturns as a way to protect themselves from market down slides. It continues to be popular, with tokens sometimes changing hands more than once a day. This has made Tether a useful source of liquidity for the market, which helps to keep prices stable.
Tether’s future will rely on whether it can maintain market confidence; were its critics to be proved right, a loss of confidence could lead to insolvency for many cryptocurrency exchanges who use it to store value.
