Guides to Cryptocurrencies
11. Tether (USDT)
Chinese Name: 泰达币
Co-Founder: Brock Pierce
Tether (or USDT) is a cryptocurrency token and was originally known as “Realcoin” in July 2014. Readcoin was officially launched by co-founder Brock Pierce and was renamed to “Tether” in November 2014.
The development team including the creators claimed that every USDT token is a digital stablecoin and will be backed by one US dollar. The company website claimed that Tether was incorporated in Hong Kong and that all USDT tokens in circulation will always match their reserves, with reserve holdings published daily as well as subject to frequent professional audits.
Some traders trade USDT coins because the price had always been stable at around $1 USD and was not affected by wild speculations or price swings as of today June 2018. Traders can trade their crypto coins to USDT tokens after making a profit, wait for the price to drop and invest back in the same coins that they profited in, taking advantage of arbitrage opportunities without the need to use bank wires. Some traders prefer to move profits to Tether instead of fiat because few exchanges allow trading of coins to fiat. Those that allow crypto-to-fiat trading usually charge much higher fees and it is much more difficult to withdraw fiat out of exchange due to government regulations.
There are concerns among traders that Bitfinex, one of the largest cryptocurrency exchange in the world by trade volume, created Tether to stabilize and manipulate Bitcoin prices especially after critics informed that CEO of both Tether and Bitfinex (Jan Ludovicus Van Der Velde) was the same person. Most cryptocurrencies have a finite coin supply, but that is not true for Tether since new USDT coins can be issued whenever customers purchase Tether with fiat currencies.
Tether became the cryptocurrency with the world's 9th largest cryptocurrency market cap of more than $3.1 billion USD as of 3rd June 2019.