A Brief History on Tether.
- 2 mins
Tether is an open-source, peer-to-peer blockchain-based digital currency with roots in the U.S. The blockchain protects the system from being overtaken by a single entity.
There are several variations of the tether token, in theory, tied to fiat currencies which are;
__ The U.S. dollar Tether - USDT - tied to the U.S Dollar
The Chinese-Yuan Tether - CYT - is tied to the Chinese Yuan.
The Euro Tether - EURT - tied to the Euro
The Gold Tether - XAUT - is tied to one ounce of gold per token. __
As a result, Tether is a stablecoin, different from cryptocurrencies like Bitcoin and Ethereum, whose prices fluctuate significantly and whose value is determined on a more speculative basis. That said, a report from CryptoCompare shows that nearly 80% of Bitcoin trading is done in Tether, making it a major source of crypto liquidity.
This type of crypto is designed to be tied to the value of the fiat currency that it represents. In other words, each Tether token is supposed to be worth $1 or €1 at all times.
However, this has been the subject of some controversy. In 2019, Tether revealed that it wasn’t 100% backed by fiat currency and that each U.S. Tether token was backed by closer to $0.75.
In September 2014, Tether Holdings Limited was established by the operators of Bitfinex, a cryptocurrency exchange platform headquartered in Hong Kong. The following month, the first Tether tokens (USDT) were issued.
In February 2015, Tether started trading on cryptocurrency exchange sites. Fast forward to December of the same year, the amount of Tether tokens in circulation totalled approximately 950,000.
A year later, in December of 2016, Tether had issued a staggering 6 million USDT, six times more than it issued the previous year.
In Nov of 2017, the revelation of Tether and Bitfinex being run by the same team, Later on, Tether got hacked and stated that it was no longer possible to redeem Tether tokens as dollars.
In June 2018, an unofficial audit confirmed tether holdings had enough funds ($2.25 billion) to support the number of tokens in circulation.
Although the controversy surrounding Tether is far from resolved, it’s now one of the world’s most popular cryptocurrencies.
Closing Nuggets. __
Tether is one of the more recognizable names in the crypto space. Despite a handful of controversies that the currency and its company have run into, it has still proven to be a rather secure and stable cryptocurrency.
Again this is mainly due to the fact that it is tied to the value of existing fiat currencies. That means it’s not subject to intense market swings.
Tether is immensely popular and easy to buy on any cryptocurrency exchange. So if you’re interested in getting into the crypto game, this could be a good place to start.
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