Trade USDT - USDT Markets, Exchanges, Broker
The tether coin is an exception in the world of crypto currencies. While most new payment units have to struggle with massive exchange rate fluctuations, this is not the case with the Tether Token. The reason for this is simple: a token is always relatively exactly worth one dollar. This is made possible by a special measure: the organization behind the cryptographic currency specifies that the corresponding amount of state money is to be kept in reserve for each token. The owners of the tether coin should then be able to exchange it for euros or dollars at any time. At least that's the theory. In practice, however, the exchange has often not been as easy as promised.
What is the point of a crypto currency with a dollar peg?
The aim behind the cryptographic currency with exchange guarantee is to make the advantages of blockchain technology available to as many companies and institutions as possible. This makes money transfers possible almost in real time and at extremely low cost - which could greatly simplify trade between countries with different national currencies. Other networks, such as the Ripple Coin, have also set themselves this goal. Due to the strong price fluctuations, however, this is not attractive for many players. What is the point of low transaction costs if you also have to take into account the fluctuations in value of the intermediate crypto currency? This problem could be solved by Tether's approach.
The prerequisite, however, is that maximum transparency is guaranteed. This is because the system only works if the necessary reserves are actually demonstrably available and there is sufficient trust in the organisation behind the coin. But there are more and more doubts about the latter point in particular. For a long time it was kept secret that the makers behind the Tether Coin are the same people who also operate the exchange exchange Bifinex. This only came to light through the revelations of the Panama Papers. Moreover, there is virtually no verifiable information about the CEO of both companies, Jan Ludovicus van der Felde. It is therefore comparatively difficult to assess the seriousness of this information.
The billion-dollar reserves stabilize the system
In addition, there are always doubts about the existence of the alleged collateral. Although the corresponding bank documents are published regularly, there is no concrete proof - although the developers have already announced this several times. Even the surprising change of auditor some time ago did not help to put an end to speculation. In addition, the conversion of the crypto currency into dollars or euros is deliberately made more difficult. This is only possible for verified Tether customers. But anyone who has bought their token on an independent stock exchange cannot claim this. However, this means that an important pillar of the system is not as stable as originally planned.
Does the Tether Coin cause a drop in the Bitcoin price?
The US economist Nouriel Roubini therefore has a suspicion: according to his analyses, the tether coin was primarily created to manipulate the Bitcoin price. According to his analyses, newly created tether tokens were directly exchanged for Bitcoins on a number of exchanges - and thus had a considerable influence on the price development of the leading digital currency. Conversely, however, this would also mean that the tokens had to be exchanged: If the tether coin is not actually deposited with the promised securities, this could also have a negative effect on the price of the bit coin. Roubini even believes that a price drop of 80 percent is possible. So far, however, it has not been proven that the tether coin has actually been cheated. The idea behind a digital currency backed by collateral remains very interesting in any case.