When there is no stability on coins value and it is volatile, users will be confused about buying goods and services in fear of losing coins value. Though the cryptocurrencies like Bitcoin and Ethereum have been used more for transactions like online payments, they are not reliable using it for daily transactions due to high volatility.
In order to see a future where crypto is used on a day to day basis, the volatility of the crypto coins are definitely needed to be tackled, and this is where Tether is introduced.
What is Tether?
Tether is a cryptocurrency which represents the real currency in the Blockchain market. It is a hybrid between cryptocurrency and fiat money whose value is pegged to 1 dollar for each token. Moreover, it generally belongs to a new group of a cryptocurrency called stable coins and it is the world’s most popular crypto stable coin.
However, Tether is specially designed to build the bridge between fiat currencies and cryptocurrencies, it usually uses a USDT currency, which has the same worth as USD. Moreover, stablecoin like Tether will be the main source of liquidity in the crypto market.
Who invented Tether?
In January 2012, J.R. Willet described in a Whitepaper about building a new coin on Bitcoin Protocol. He just wants to implement his idea on crypto Mastercoin. Brock Pierce, who was a member of the Mastercoin Foundation, became Tether’s co-founder. It also got another founder Craig Sellars, who was the CTO of the Mastercoin Foundation.
Moreover, in July 2014, “Realcoin ” was announced by co-founders Brock Pierce, Reeve Collins, and Craig Sellars. In addition, on 20 November 2014, the project was renamed “Tether” by CEO Reeve Collins.
- January 2012 – Tether whitepaper was published
- 6 October 2014- Issued the first token
- 20 November 2014- The project was being renamed to “Tether” announced by Tether CEO Reeve Collins
- January 2015 – Trading of Tether enabled by the cryptocurrency exchange Bitfinex on their platform
- 18 April 2017 – The international transfers had been blocked
- June 2017- Tether would soon be issued on the Omni layer of Litecoin announced by the Omni Foundation and Charlie Lee
- September 2017- Launching announcement of additional ERC-20 tokens for US dollars and euros on the Ethereum blockchain
- January 2018 – Announcement from Tether that they no longer had a relationship with their auditor
- 2018 – Tether accounted for a bitcoin trading volume of 80% and during the summer of 2018 it accounted for up to 80% of bitcoin volume.
- 15 October 2018 – Tether price briefly fell to $0.88
- November 2018 – New banking relationship with Bahamas-based Deltec Bank was announced by Tether.
- April 2019 – New York Attorney General Letitia James filed a suit accusing Bitfinex of using Tether’s reserves to cover up a loss of $850 million.
How does tether work?
Tether is generally new assets that move over blockchain like other digital currencies. It is not money, but it is digital tokens that hold the value at 1:1 to the underlying assets.
How much is Tether worth?
The value of Tether is stable at approximately $1.
Difference between USD and USDT
The US Dollar is generally one of the leading currencies in the world, whereas USDT is a crypto blockchain-based stable coin that is used for trading the $1 USD. Moreover, US Dollars are held directly into a bank account. USDT is crypto coins issued by Tether, which are accepted by some exchanges.
However, the trading volume is higher on Tether than on USD. The markets BTC/USDT are less compared to BTC/USD markets. BTC/USDT and BTC/USD almost mirror each other with small tracking errors. BTC-USDT and BTC-USD displays different volatility returns.
Aggregate Liquidity statistics
Aggregate statistics, 365-day window, Kaiko OHLCV data, April 1st, 2019 — March 31, 2020
|Accumulated traded volume (BTC)||21,091,599||162,215,883|
|Exchanges reporting trades||23||31|
|Top 3 exchanges||Coinbasee, Bitfinex, Bitstamp||OKEX, Binance, BitForex|
|Top 3 exchanges market share||26.91%, 19.56%, 16.06%||13.41%, 13.11%, 11.43%|
Benefits of tether
- Tether usually exists on the blockchain of bitcoin, instead of less developed altcoin blockchain
- Contains a P2P, pseudo-anonymous, decentralized, and secure environment.
- It can also be integrated with the exchanges, merchants, and wallets
- It also inherits the properties of the Omni Layer protocol, which is a decentralized exchange, open-source, transparency, accountability, and multiparty security.
- Market risks such as black swan events will not be faced by Tether.
- Moreover, Tether 1:1 ratio will be easier for non-technical users also.
- It will not face any kind of pricing or liquidity constraints.