If you’re looking for less volatile assets among the cryptocurrencies, then you’ve to consider Tether (USDT). With a market cap of over $60 billion, Tether currently ranks among the top three cryptos (only behind BTC & ETH).
Tether has attracted several investors due to the fact that it is the only cryptocurrency that has a stable price. If you’re keen on investing in Tether, then you should know about it.
This article addresses the major things you need to know about USDT as you make move to invest in it.
What is Tether?
It is a blockchain-based cryptocurrency that is backed by the U.S dollar. It is pegged at the same rate as the U.S dollar (1 Tether is always $1).
Tether is a stablecoin, unlike other cryptocurrencies. For this reason, it is attracting investors. It is the most popular & well-recognized stablecoin.
Stablecoin in the crypto market avoids volatility which makes it to be a store of value rather than a risky investment like other cryptos.
Although there are controversies surrounding the Tether token, it has, however, become one of the largest cryptos. It is easy to find as you can buy it on most of the top cryptocurrency apps & exchanges.
Let’s take a look at the major things to know before you buy Tether.
Also Read: Is It Safe To Invest In USDT?
5 Things To Know Before You Buy Tether
- Tether is a stablecoin pegged to the US dollar: USDT is intended to have an equal value with the US dollar with 1 Tether being worth $1. Since its price is stable, it’s not the type of crypto that you can buy and hold in hopes of the price appreciating.
- It can be used as a means of exchange: Tether may not be right as a crypto investment, it can however serve an exchange purpose. It can be used to purchase other cryptos, transfer money, and earn interest if you lend your crypto without its value fluctuates.
- There have been issues with the company behind Tether: Although USDT might seem safe as a stablecoin, there’s reason to be cautious about it. The company that issues it, Tether Limited, is controversial. This includes a controversy of being backed by the USD. An audit of its dollar reserves that was supposed to happen in 2017 had never happened. The company parted ways with the investors instead of having its reserves maintained.
- There are allegations Tether has been used to manipulate Bitcoin’s price: The stablecoin was also in a controversy of being artificially pumped into the cryptocurrency market. This is to create liquidity that was the driving force behind Bitcoin’s bull run-up to the US $20,000. Tether company isn’t known for being totally transparent. It has been stated that the company could mint new coins and then use them to buy Bitcoin. This would allow the company to obtain Bitcoin with non-existing money and also pump up Bitcoin’s price.
- Tether still maintaining top position in the crypto market: Despite the controversies surrounding Tether (USDT), it has maintained its position at the top. New tokens are minted as demand continues to rise. According to CoinMarketCap, Tether ranks 3rd in terms of market cap. USDT is currently valued at $62,631,619,572 with the current price at $1.00.
These are the major things you should know before you buy Tether. You can buy Tether tokens on many major crypto exchanges and lending platforms. Most will pay anywhere from 6% to 12% in interest just for storing Tether on their platforms.
Prestmit is, however, one of the best platforms to buy USDT and earn high interest rates.