The past two months have been stressful for cryptocurrency investors due to massive turbulence. The value of popular cryptocurrencies including Bitcoin, Ethereum, and others, have fallen sharply during the crash.
Many cryptocurrencies staged a decent comeback, but the cryptocurrency market is still volatile and uncertain. This dubious situation has left investors divided, as some are rushing to dump their holdings, while others support ‘buying the dip.’
Amid the market re-correction, Tether, the oldest and most popular stablecoin surged to the highest since the “Black Thursday” sell-off in March 2020. In a $3 trillion crypto market, Tether is a lesser-known cryptocurrency, though.
What is Tether?
Issued by the company Tether Limited, Tether (USDT) is pegged to the US Dollar and, the value does not fluctuate as per crypto market, meaning 1 Tether will always be worth exactly 1 USD. Hence it is called a Stable coin.
Since Tether mirrors the USD, it may not be the right coin to invest in hopes of the price going up. But, it has its use cases including, purchasing other cryptocurrencies, transferring money, and earning interest (25%).
Is it safe to buy Tether?
As we all know by now, the crypto market is highly volatile. You can earn or lose a fortune in a matter of seconds. However, Tether is beyond all these fluctuations. Compared to other cryptocurrencies, Tether has very few risk elements, making it a safe coin to buy.
According to CoinMarketCap, Tether ranks 3rd in market cap at $62,631,619,572. A new report from Changelly says the growing popularity of Tether can help investors in gaining good returns in 3-5 years. “If you look for a good return in 3 to 5 years, USDT might be the coin to watch closely now.”
How to buy Tether in the UK?
Tether is available in most of the exchanges and, you can buy it with almost every other cryptocurrency or fiat currency including, Pounds, Euros, or US dollars.
To buy Tether, you need to create an account on a cryptocurrency exchange that sells it. If you are in the UK, check out Coinbase, Kraken, and Binance. These exchanges are reputed, have excellent security and decent fees.
Creating an account with exchanges requires you to submit ID documents and fill in some information. Upon account creation and verification, you can purchase Tether with the following payment methods – Debit Cards, Credit Cards, PayPal, and ACH bank account transfers.
It is better to make a purchase with a bank transfer since it has the lowest transaction fees, however, it takes time to reach your crypto exchange account. On the other hand, Debit cards, Credit cards, and PayPal are faster but carry an additional fee. Since Tether is a stable coin (has fixed value), it is better to save the additional fee through bank transfer.
Once the balance gets credited to your crypto exchange wallet, you can purchase the Tether accordingly. As we mentioned above, you can hold the coin for the long term, lend it for interest, or buy other cryptocurrencies.
Controversies
Tether might seem like a safe coin but the company that issues it, Tether Limited, has been through several controversies. The Hong-Kong-based company previously claimed that every Tether was backed by $1.
However, the company released information on its reserves, which showed that only 2.9% of Tether is backed by cash, while the rest are all in commercial paper.
Tether Limited was accused of an alleged cover-up related to a crypto exchange called Bitfinex. However, the case was settled later after the owner of Tether Limited and Bitfinex paid a fine of $18.5 million (approx £13.5 million).
In another case, critics of Tether have claimed that stablecoin is used to inflate the price of Bitcoin.
Conclusion
Since Tether can be redeemed for US dollars, the stable coin can be a powerful tool for avoiding the sometimes extreme volatility of the cryptocurrency markets. What do you guys think about it?
Disclaimer: The information in this article is for educational purposes. The action you take upon the information of this article is strictly at your own risk.
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