Emily Clarke

What is Tether in Crypto?

One of the biggest reasons why investors hesitate with cryptocurrency is its volatility. While the decentralized nature of crypto is alluring, the ever-changing price can make many would-be investors search for other options. Fortunately, there are other options beyond Bitcoin and Ethereum.

Tether is a stablecoin first launched in 2014. It went by the name "RealCoin." However, it quickly rebranded as Tether that same year. Owned by iFinex, Tether has the benefit of being pegged to the U.S. dollar. According to Tether's website, it's backed 100 percent by Tether's reserves.

The Benefits of Tether

Take a look at a Tether price chart. You can go back several years and see that the value of Tether remains virtually unchanged, give or take a couple of cents. A single Tether is equivalent to a single U.S. dollar.

That's what makes this crypto so alluring to investors. Unlike other coins, Tether is pegged to real currency. As a result, they're not subject to the price volatility other coins have. While that does prevent explosive value increases, it also avoids a substantial decline. It's a safer investment due to its collateral reserves and doesn't have the unpredictability of more speculative cryptocurrencies.

Stablecoins, like Tether, are also great as a medium of exchange. The nature of stablecoin promotes similar uses to conventional money. Many investors use it to pay for goods and services. It's also popular among those who participate in decentralized finance protocols. For example, many use it as collateral for staking and lending.

Is Tether Worth Buying?

Take one look at a Tether price chart, and you'll see why it's the third-largest cryptocurrency behind Bitcoin and Ethereum. The stability of Tether makes it a unique option for investors. It's useful in many ways, serving as a medium of exchange. Tether also helps investors move funds between cryptocurrency markets and traditional financial systems.

The one-to-one peg minimizes volatility and makes it easier for investors to explore new opportunities without the risk of speculative coins. While some value fluctuations occurred recently due to the collapse of other stablecoins, Tether continues to go strong.

Author Resource:-

Emily Clarke writes about portfolio management, finance tracking and Consumer SaaS services. You can find her thoughts at crypto exchanges blog.