About Tether USDT
In a smart pitch for a definite niche, the altcoin Tether is following a middle way towards consumers’ hearts. A decentralized digital currency that is nonetheless backed by the USD, the coin finds a sweet spot with many more traditional investors.
While inane to some enthusiasts, enjoying the benefits of the decentralized blockchain ledger and the familiarity of a known fiat currency offers users the best of both worlds, it seems.
An altcoin backed by a fiat grants the ease of the consensus protocol as well as the stability of a traditional asset. Tether Limited has built in a mechanism to maintain a value fixed to the USD. With the Tether (USD₮) coin, Proof of Reserves and other auditing methodologies are at play, enabling a cryptocurrency constantly on a par with the USD.
How Is Tether (USDT) Better?
For many, the mere idea of a “backed” altcoin is absurd and anathema to the whole idea. For possibly many more with money to invest, finding a middle route that allows them to join the cryptosphere with the usual reassurances is welcome.
Blockchain transactions are eminently better in many ways for users. Fiat transactions are slow – sometimes taking days – and affected by exchange fluctuations. While Bitcoin and others should ostensibly be providing lightning speed and an unrivaled stability, right now either option comes with liabilities.
That said, imagining a future where cryptocurrencies are known and stable assets, Tether seeks a jump start on that reality by pitching a backed coin that carries all of the blessings and none of the hassles. In any modern digital transaction, speed and thus value stability is improving.
User issues arise when people seek to cross platforms when transacting, usually settling accounts or making deposits. So while a vendor may have both USD and a cryptocurrency with which to pay, the variances in the currencies preclude him from conducting his business and settling as he sees fit.
Tether aims to eliminate this entirely by being an altcoin with a dollar value. Supported by the Omni Layer protocol, Tether is issued on a one-to-one ratio with held dollar reserves. The coin can be spent or stored or traded, as with any other digital currency.
What is Tether Imagining?
Tether is typically expressed in USD, but the coin also trades on euros, with Japanese yen (JPY) soon to be added to the list of supporting currencies. The very name “Tether” implies the known, stable nature of the coin, tethered as it is to the fate of the U.S. dollar.
As opposed to a merchant having to find a counterpart who will accept his more efficient way of paying but one that involves digital currency, Tether imagines a world where they have taken the unknown out of the transaction. By offering Tether for payment, any vendor anywhere in the world will immediately know its value in dollar terms and hence not hesitate to accept it as payment. More perhaps than a transition from old to new, the Tether model my well persist, as it does represent a painless middle way for businesses all across the globe.
The coin is a stable currency and is a route to easily converting fiat into digital money. Although two or three prime currencies are accepted as supporting currencies, one Tether coin is always equal to $1. The company publishes a pleasingly transparent Tether Reserve holding figure daily, and issued Tether coins are tied strictly into held reserves, by number.
The coin could well represent the most applicable means of integration needed to marry traditional business with the cryptosphere. Rich in blockchain technology and also rich in reserves of probably the best-known fiat in the world, the coin leverages the security and trust of the decentralized ledger.
Tether is not alone. Possible advantages Tether has over other such backed altcoins include its tremendous flexibility to cross platforms, its risk-averse focus that sees the company acting as custodian of value and its ability to please without liquidity constraints. Users get the benefits of rapid transactions that also come with low charges.
Not only merchants, but exchanges too can benefit from Tether’s ability to address the following common issues:
- The problem of a currency conversion fee
- The difficulty of finding the right payment providers
- Exorbitant costs on low value transactions
- Exchange integration with banks that have no usable API
- Time delays in clearing international wire transfers
Tether also trumpets its ability to add an additional layer of security for existing exchange users. By employing the coin, users can avail themselves of watertight security and also avoid having to store loads of fiat on an exchange. For individual users, Tether represents the same fluidity as digital wallets are providing, but with a known value.
Moreover, the coin claims to represent the security of fiat with the anonymity of altcoins, something sure to be tested down the line. One interesting feature of the coin can be expressed is the fact that users can now store a real dollar value in the form of a crypto-wallet.
Tether allows merchants to cost goods and services in USD, although it’s an altcoin. In addition, both the features of fiat and those of cryptocurrency can be leveraged to enable a greater business fitness, particularly when transacting. Reduced fees and greater reassurance through tighter proofs are further business benefits that appeal to many companies.
Tether (USDT) Conclusion
Tethered on a one-to-one ratio with the USD and free of the impact of market forces pertinent to altcoins, the currency has wide application. The mining protocol so typical of many digital currencies is absent with Tether, as mining would jar against the fundamental nature, construct and purpose of the backed altcoin. One Tether is always equal to one dollar.
Unlike Bitcoin and most other digital currencies, Tether coins are supported by a reserve of fiat currency held as such by Tether Limited. Bitcoin was indisputably created to become an alternate currency and to operate as such beyond the reach of banks, governments or a nation’s borders.
Tether, on the other hand, was created to integrate blockchain technology with existing fiat currencies. The coin essentially converts cash into a digital asset. Enjoying the best of both worlds as it is, the token should experience appreciable adoption as it concentrates on integrating existing business into the cryptosphere.