Review on Tether by Fanuel PORPORTY
Tether, one of the best-known stablecoin in the entire cryptocurrency universe
Tether offers cryptocurrencies which have the particularity of having a constant rate: 1 USDT = 1 $, 1 EURT = 1 €, etc ...
Tether, formerly known as RealCoin and was an ordinary altcoin, quite popular with traders, but not to the point of being able to compete with Litecoin, Namecoin or other cryptos. The leaders of Tether therefore decided to change their name to have a positive impact on their business and they were right! Simplifying as much as possible we could describe Tether as a service transforming the dollar, the euro and other fiats into digital currencies which can then be exchanged using Blockchain technology.
You are certainly wondering how the rate “1 $ = 1USDT” is maintained?
The basic principle is relatively simple to understand: everything is based on a balance between the total amount of USD present on Tether's account and the number of USDT in circulation. To prove it Tether is completely transparent on the amounts in its possession, you can check it yourself on their site. The number of tokens (USDT) in circulation therefore has no limit, so the higher the demand, the more this total will increase.
Interest
1. In a world as volatile as cryptocurrency, having a stable cryptocurrency is a safe haven. When Ethereum or Bitcoin can lose up to 30, 40 or even 50% in a few hours, Tether does not budge!
So if you think the cryptocurrency market is going to crash, then you can switch all of your cryptocurrencies to Tether to protect yourself from potential losses.
2. The other interest lies in the platforms. They often find it extremely difficult to reach agreements with banks.
Tether therefore partly solves this problem.
Pros
- 1: 1 rate with the dollar making it a very stable currency. It is therefore a good alternative to Bitcoin, which is much more volatile, if you want to use it for online payment.
- Indexed to the dollar. The dollar being one of the most stable currencies in the world, the investment is in fact much less risky
- Available on many platforms
Cons
- Leaving funds in Tether (USDT) carries a risk, will a USDT always be worth a dollar?
- This cryptocurrency is very controversial and many believe that the Tether model is not viable in the long term
