What is USDT & how does it work?

USDT’s unique feature is the fact that its value is guaranteed by Tether to remain pegged to the U.S. dollar. According to Tether, whenever it issues new USDT tokens, it allocates the same amount of USD to its reserves, thus ensuring that USDT is fully backed by cash and cash equivalents.

What is Tether (USDT)?

Tether ( USDT) is a cryptocurrency stablecoin pegged to the U.S. dollar and backed "100% by Tether's reserves," according to its website. 1 Tether is owned by iFinex, the Hong Kong-registered company that also owns the crypto exchange BitFinex. Tether was launched as RealCoin in July 2014 and was rebranded as Tether in November 2014.

Is USDT a stablecoin?

USDT has since migrated to other blockchains like Ethereum. As we mentioned earlier, USDT is a breed of cryptocurrency called a stablecoin. Cryptocurrencies such as Bitcoin, Ethereum, and many others are notorious for their volatility (i.e., their price fluctuations).

Is USDT good for trading cryptocurrencies?

Like other stablecoins, USDT is useful for trading cryptocurrencies as it allows traders to avoid market volatility that is common to BTC and other crypto assets. Using stablecoins also removes the extra costs and delays of converting between crypto and fiat currencies. Tether is a key part of the cryptocurrency ecosystem.