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USDT

What is USDT?​

USDT or Tether was the earliest stablecoins issued in 2014 by Hong Kong-based company Tether Limited. The idea behind USDT was to bridge the gap between cryptocurrency and fiat currency, a goal that Tether achieved successfully. For the first time, Tether allowed crypto holders access to platform-specific, blockchain-based US dollars that had high liquidity as other cryptocurrencies (Bitcoin, Ethereum, and other crypto assets) but eliminated their price volatility.

With high liquidity and low volatility, USDT offered traders an opportunity to transfer crypto-dollars to anyone at a low cost, with increased transparency and speed. That opened unlimited possibilities for conducting all sorts of crypto-dollar transactions, including remittances, payments, and more.

As the earliest fiat-currency-backed crypto token, Tether quickly established its niche in the stablecoin ecosystem, thanks to the hundreds of cryptocurrency trading that began pairing against USDT. Even so, the early days of USDT were marred by illegal activities. For example, a security breach of Tether’s network in 2017 resulted in the theft of 30 million dollars worth of tokens. As a result, Bitfinex (Tether’s parent company) was accused of illegally soliciting $850,000 from Tether to offset the debt.

Tether Limited has since removed vulnerabilities within its system, and today, 74.7 billion USDT tokens - twice the volume of USDC tokens - are in circulation on major crypto networks, including Algorand, Bitcoin, Ethereum, Tron, and many more.

How can I use USDT?​

Unlike USDC, Tether can’t be used on the Coinbase system, which limits people who prefer using the service. The upside to USDT is that it’s the most popular stablecoin with the highest circulation volume, making it the only USD-backed coin you can use for exchanges to facilitate purchases or conversions to other cryptocurrencies.

There are several benefits of using USDT. For instance, you can not only transact quickly and cheaply, but you can also earn interest on decentralized finance protocols. Besides, it allows businesses to accept cryptocurrency payments as USDT tokens valued using the USD standard. That eliminates the need to accept payments in the form of cryptocurrencies, which exposes them to high volatility risks.