In this article, we will dive into the history of Tether and how it works to answer all these questions and alleviate the frequent bouts ofthat can afflict crypto investors. Ironic for what is supposed to be a stable asset, there’s a lot going on in the world of USDT and the utility it brings to the entire blockchain industry is more important than you may think.Join us in showcasing the cryptocurrency revolution, one newsletter at a time.
Although USDT may be exchanged for goods and services just like cash, its true value lies in its ability to maintain its peg to the U.S Dollar and provide users with a reliable way of transferring funds. Digital currency traders and investors require a digital store of value that remains stable if they choose to remain on the sidelines during times of market volatility.
There’s no argument that Tether’s demise would be catastrophic for the crypto industry, especially since USDC’s recent de-pegging. Of course, Tether also experienced a drop to as low as 80c. However, there's still a nagging worry that if USDT fails to retain a proper dollar peg, it could cause a ripple effect with massive losses across the broader cryptocurrency market. Users would end up undercutting each other left and right to convert their holdings into different assets. Some analysts believe that if this scenario played out, the fallout wouldn’t be as bad as we think.
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Source: Cointelegraph - 🏆 562. / 51 Read more »