Tether, the company behind the cryptocurrency of the same name, has been in hot water of late. After a hack that resulted in a loss of $30 million USDT, questions have mounted about the company’s practices and transparency.
But what is Tether? And why is it important for the cryptocurrency markets?
Tether was originally built to enable users to trade between fiat currencies (USD, EUR, JPY, etc.) and cryptocurrencies like bitcoin. Backed by the US dollar and other currencies, each tether token represents one dollar of the underlying currency held in reserve. The reserve assets are held in segregated accounts at a number of banks around the world.
Tether tokens are issued on the bitcoin blockchain using the Omni Protocol Layer and represent a claim on real-world assets. They were designed to mirror the price of fiat currencies like USD. This means that 1 tether token is always worth 1 USD (or equivalent fiat currency).
As such, they can be stored or transferred just like any other cryptocurrency. However, they provide an additional level of stability since they represent a stable value asset. Each tether token can be redeemed for $1 with Tether Limited at any time.*
Tether is a cryptocurrency token backed by fiat currency assets, including US dollars, Euros and Yen. The currency was designed to allow individuals to use blockchain-based applications, while still maintaining relative price stability. While many cryptocurrencies experience wild swings in value, Tether has a $1 parity with the US dollar.
Tether is an alternative to traditional methods of currency exchange. It aims to make it easier for individuals and businesses to use cryptocurrencies without fear of market fluctuations in the value of those currencies. In this way, Tether can be used like a conventional currency. Tether allows cryptocurrency traders to transfer money between exchanges without having to convert their funds into traditional fiat currencies every time they want to trade.
Tether was originally launched on November 01, 2014 under the name Realcoin. On February 25th 2015 the company rebranded itself as Tether, reflecting the 1:1 parity with the US dollar that was introduced at that time.
Tether is a cryptocurrency token issued on the Bitcoin blockchain via the Omni Layer Protocol. Each unit of Tether is backed by one United States dollar, held in reserve. This means that a user sending in USD to Tether will receive the equivalent amount of tokens.
Tether aims to provide a simple interface for businesses and individuals to access a blockchain-based cryptocurrency that is always valued at a 1-to-1 ratio with the US dollar. Tether USD tokens are 100% backed by actual dollars, deposited in the Tether Limited reserves. Their value stays as stable as that of the US dollar since they can be redeemed through the Tether Platform.
The company has its headquarters in Hong Kong, with offices around the world. The company claims to have more than 600 million tethers (USDT) in circulation, and over $4 billion worth of transactions across various exchanges. Many cryptocurrency traders use tethers because they reduce volatility risk during periods of uncertainty and help them maintain an exit strategy for redemptions into US dollars or other currencies without having to liquidate their positions into less stable markets, which could incur large losses in price.
Tether is one of the most popular cryptocurrencies in the world, known for its stability and reliability. Tether, or USDT, was designed to be backed 1: 1 by the dollar. The company issues digital tokens that are allegedly supported by assets in the real world (eg USD).
This approach allows Tether to maintain a stable value of $ 1 per token. In this way, it works as a utility token, whose stable price enables traders to manage their portfolios effectively.
In addition, some investors use Tether as a method of storing value; others consider it a safe haven when stock prices fall. Some also use USDT as a means of protecting themselves from inflation.
Since its launch in 2014, Tether has grown rapidly and has become one of the largest cryptocurrencies in terms of market capitalization. In recent years, it has generated great controversy; However, despite all this criticism, the cryptocurrency remains incredibly popular.
While many are familiar with the major cryptocurrencies, there are hundreds of other digital currencies available. Tether is one of these less popular cryptocurrencies that has made its way into the crypto market.
What is Tether?
Tether (USDT) is a cryptocurrency issued by Tether Limited Company and pegged to the US dollar’s exchange rate. The idea behind Tether was to create a stable coin that would not be affected by volatility in the cryptocurrency market. This would allow people to make transactions using a currency that maintains its value regardless of whether or not the cryptocurrency market is doing well or poorly. One tether coin is equivalent to $1 USD.
How Does It Work?
The goal was for every tether coin to be backed by an actual US dollar held by the company. In theory, this would mean that one could always redeem one tether for $1 USD. However, some have questioned whether or not this is actually happening, as there has been no official audit in years. There are also concerns as more and more tethers are released into circulation while no new money is being added by the company. In fact, one report concluded that 60% of Bitcoin’s 2017 price increase can be linked back to tethers being printed without any new money coming in from investors.
The cryptocurrency market is currently in a bull run, and Tether appears to be the driver of that bull run. The reason for this is because many believe that Tether is used to manipulate the price of Bitcoin. These claims have not been proven, but they are certainly not without merit.
Tether has been associated with a number of controversies in its short history. In January 2018, it was revealed that Tether’s bank accounts had been frozen by Polish bank ING. This caused the price of Bitcoin to drop sharply, and would have resulted in a loss for investors who were holding Bitcoins at the time. However, no such loss was suffered by investors due to the fact that there was no loss of funds or assets.
In April 2018, Tether announced that it had lost $31 million worth of tokens as a result of a hack on its system. This has led some investors to question whether or not the company is solvent and able to continue operating.
Tether has also been accused of having ties to Bitfinex, one of the largest exchanges in the world. This is due to Bitfinex’s decision to peg all its coins to USDT instead of USD or EURO.
Bitfinex’s CEO recently admitted that he had no idea how
Tether is the most widely integrated digital to fiat currency today. Buy, sell, and use tethers at Bitfinex, Shapeshift, GoCoin, and other exchanges.