Apart from other shit coins, or perhaps other popular cryptos like the Bitcoin, Ethereum, Dogecoin, XRP, and so on — It’s no longer news that stable coins have been one of the most trending topics among cryptocurrency enthusiasts.
And if you are the type that follows trends, maybe a crypto fanatic — you should be aware. Hence, why should you know about USDT, and how can you benefit from it?
Why You Should Know About USDT
Well, before that, USDT is also called Tether, in case you do not know.
In this article, you’ll learn about everything you need to know about Tether and why you must know.
You’ve probably read USDT above. Let’s begin with that — to help you understand what USDT is, let’s start with a stable coin.
What’s a Stable Coin?
A stable coin is a type of cryptocurrency built around other stores of value such as fiat currency, metals, and other cryptocurrencies. Therefore, USDT stands for United States Dollar, and adding Tether(the original name of USDT) makes it USDT. The reason behind pegging this to a particular is that the value of the asset USDT is pegged to would support Tether’s value and decrease the volatility.
If you are unsure what dictates most cryptocurrencies’ value, demand and supply do, which implies that more people believe it’s valuable, validates its value, and vice versa. The same way people’s opinions influence it, likewise Fundamental(government). So, in short, human and legislative bodies are the determinant of its value. Suppose no one uses it or does not talk
about it. Then, it’s nothing to write home about.
Due to the fluctuations of cryptocurrency, it fits as an investment asset and not a medium of exchange for our everyday transactions.
Otherwise, because stable coins are usually pegged to relatively strong assets, stable coins experience a lot of stability. Therefore, they are appropriate for daily transactions and as a store of value.
Strong fiat currencies like USD, GBP, and Euro are the backbone of most popular stable coins, but we can still count on a few supported by other asset types. A typical example is MakerDAI, which entails a mix of decentralized crypto assets as its backbone.
Like USDT, other stable coins with US Dollar as their backbone are Gemini Dollar, TrueUSD, and USDCoin.
What is USDT (Tether)?
In more detail, let’s treat Tether further.
Tether, known as USDT, is a stable coin clinched to the United States Dollar (USD). Its ratio is equal to USD, as in 1:1 — 1USD is the same in value as 1 Tether.
Tether came into existence in the crypto market to solve volatility, which is the difficulty many traders face with cryptocurrencies. Volatility means instability of coins’ price. So, you see why it’s risky — either as a means of exchange or a store of value. However, it proves some advantages, not only for traders but also for investors.
Tether is hosted on the Ethereum blockchain, and it does not run on its blockchain. Shall we move unto the practical uses of USDT? Let’s go!
Why Use USDT Instead of USD?
Like any other cryptocurrencies, Tether created USDT function on a decentralized system — everyone controls their stuff, not a government or anybody involved; the government cannot police it.
Among the pros of USDT over USD is that it cuts access time and reduces access. Acquiring USD might need you to go through your bank and spending valuable time filling forms, Depending on your country of residence. The reverse is the case with USDT, where you can complete your transactions in less than 5 minutes, exchange your local currency with it and carry out the supposed transaction.
The second advantage is that USDT allows you to cut across barriers because USDT is not a currency that works in a centralized manner. Putti is the USA aside, where the US dollar is a legal tender, USDT favors an extensive borderless reach, and business that supports crypto innovation accepts it as one of their gateway payments.
We’ve finally reached to what brought you onto this article — why one should know about USDT.
Here is why:
Why is USDT Important?
If you trade crypto or you’re into any unstable local currency, you should consider USDT, and here is why it’s crucial:
1. You wouldn’t have to worry about volatility anymore
Why? Because Tether(USDT) is a stable coin, hence, less volatile. Even if you choose to hold it, you have no business with price fluctuations, usually with most cryptocurrencies.
If you trade other unstable coins and are bothered about so many fluctuations while trading, one of the best things you should do is convert your local currency to a stable currency like
USDT until the price of whatsoever currency you are trading stops dropping. That way, it saves you a lot of time and protects your profit.
2. It’s A Run-to Refuge During Inflation and Currency Devaluation
If your country is among the countries in the world that experiences high inflation or depreciation in the currency, USDT should save you from those worrying times. USDT is nothing but an inflation lifejacket. Since its value is equivalent to the US dollar, it offers you a better chance of storing your money in USDT instead of leaving it in a devaluing currency.
These are just a few to mention. USDT has saved lives in inflation times or its likes. It ensures you are keeping your money firm without bothering about what would happen to your funds next.
CONCLUSION
To sum it all, USDT usefulness and benefits can never be overemphasized.
If you are from developed countries like the UK and other European countries, you might not see how impactful it is to store your wealth with Tether.
However, if you are from a country where your currency is weak and prone to inflation or Devaluation, you must have found this blog post highly beneficial.
I hope this post helps.
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