What is Tether and Why Should You Buy it?


Tether at xcoins

Tether is now available on Xcoins, but why would you buy a stablecoin?

The cryptocurrency market has historically been a volatile place. Huge price swings can occur within just a couple of hours, let alone over days and weeks. This can make paying for things using cryptocurrency problematic. 

Tether is the first “stablecoin” that solves this problem by being a cryptocurrency pegged to fiat currency value in a 1:1 ratio. First launched in 2014, it started with the US dollar, but now supports Euro, Yuan, and most recently even Gold. Tokens are labeled with the suffix T so in the case of the US dollar it’s USDT, for Euro it’s EURT, Chinese Yuan is CNHT, and the Tether representing 1 oz. of gold is XAUT. You can buy USDT on Xcoins.

How does it work?

Tether was originally built on top of Bitcoin through what’s called an Omni layer protocol. This layer enables the creation of tokens which is why Tether’s ledger was maintained and stored on Bitcoin’s blockchain. Tether was then branched off onto other blockchains like Tron, EOS, Bitcoin Cash, and Ethereum which currently host the highest number of these tokens. 

But a more important question is how Tether maintains its price stability. It does so by simply maintaining a reserve of underlying assets that represent the token. So for example in the case of USDT, Tether Limited - the company behind the token, holds US dollars and other assets to the equivalent amount of USDT supply in circulation. 

Is Tether safe?

Tether’s popularity has grown tremendously in recent years and it is currently the 4th cryptocurrency in size according to its market capitalization. In 2019, Tether overtook Bitcoin in trading volume with the highest daily and monthly trading volume of any cryptocurrency on the market. It can be used on most exchanges to purchase a huge variety of altcoins.

Tether’s Market Cap is Skyrocketing

Tether Market Cap

Source: coinmarketcap.com

As the graph above shows, Tether has succeeded in its goal of maintaining its peg to the dollar throughout the years since its launch. Aside from brief jumps in April and May of 2017, the price of USDT has generally stayed between $0.98 and $1.02 and has increased its stability in recent times with its growing supply. 

Although there has been some criticism of the methods Tether Limited uses to manage the reserves of the underlying assets that back the token, its value hasn’t changed significantly which means it is fulfilling its goal of allowing risk-free payment processing using cryptocurrency. 

Why would you want to buy Tether?

Tether is a perfect solution for people who want to store their capital in the decentralized economy but would like to protect themselves from market volatility for whatever reason. If you are preparing to make a trade but waiting for your moment, having your funds in a stable currency with which you can transact instantly is of utmost importance. USDT fulfills both of these goals.

Since the crypto market is open 24/7, trading opportunities can appear and disappear fast, and having to wait on your bank to process your payment can mean you miss out. Debit and credit card fees associated with converting from Bitcoin to cash can be costly, so profit taking by converting to Tether is one way to cash out your crypto gains without accruing any bank fees. Converting your crypto to cash can also trigger a taxable event, converting to Tether may be one way to avoid this depending on the jurisdiction.

Tether is also a great solution for making ordinary payments because the person on the receiving end can be sure that the right amount is arriving regardless of the waiting or processing time. This makes it perfect for conducting commerce in the decentralized economy. 

Buy Tether Instantly

Buy Tether Xcoins

To buy Tether on Xcoins, simply head to xcoins.com and select USDT from the dropdown to start benefiting from protection from price volatility today.

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