Surely every user who has already dealt with cryptocurrencies has come across USDT. What is USDT? Well, this coin has its own peculiarities in application, which you should know about before purchasing this cryptocurrency.
What is USDT in cryptocurrency? USDT is a cryptocurrency asset implying a digital deposit of a US dollar. In the process of creating the coin, the Omni Layer protocol was used. A special feature of the Tether cryptocurrency is that each coin is backed by a US dollar. Therefore, the number of cryptocurrency units issued corresponds to dollar reserve held by Tether Limited. The same company ensures the safety of funds in dollars as long as their own cryptocurrency is used and mined on the Internet.
What Is USDT on Binance: How to Buy USDT?
What is Tether coin? And how to buy it? Let’s try to find out! There are many ways to buy Tether on the market. Before choosing one of them, you need to decide on purpose of purchasing the cryptocurrency.
In order to store USDT, you need a wallet. You can create it on Binance which is suitable for long-term storage. What is USDT on Binance?
There is one key difference between this service and the Tether wallet. In this case, when registering, a user receives not only a wallet itself, but also access to the exchange. This exchange is the largest in terms of exchanging cryptocurrencies. The site has a fairly user-friendly interface, and exchange commission is only 0.5%.
What Is Tether Coin: Key Features of USDT
What is USDT coin? According to technical documentation, the Tether cryptocurrency has the following features:
- USDT is instantly issued as soon as a user transfers the dollar equivalent to the company’s account;
- As soon as the sum is withdrawn to a user’s account, the coins are canceled;
- USDT is a cryptocurrency that can be stored and used in the same way as Bitcoin, Litecoin, or any other cryptocurrencies that function according to the same rules;
- Users have a right to store purchased or mined coins in wallets that have Omni Layer support.
What is Tether USD? According to the developers themselves, coin holders shouldn’t completely associate coins with dollars. The license agreement mentions that this cryptocurrency isn’t fiat money in its electronic form. Another feature of using USDT is that developers apply the Proof-of-Solvency alternative using the Proof-of-Reserves method.
What is USDT crypto? How does it actually work? Here is the reservation process. The requested USDT sum is verified on Block Explorer using special tools. The dollar sum, which is an analog of the purchased coins, is confirmed by bank accounts. The company periodically conducts an audit of funds so that users can independently verify the safety and reliability of their investments.
Coin holders can use not only the dollar equivalent. If necessary, it’s possible to choose the euro or any other world currency.
What Does USDT Stand For: What Are the Key Pros & Cons?
What does USDT stand for? The developers of the coin have repeatedly admitted that the Tether coin isn’t fully backed up. The company’s cash reserves are enough to cover only 74% of the total cryptocurrency issued. Such news could cost a packet, since it was originally stated that the stablecoin would definitely be supported by dollars in a 1:1 ratio.
Key Pros of USDT
- At present, the rate of the cryptocurrency can fluctuate by no more than 2-3%;
- Each stablecoin in its face value is equal to a unit of a particular currency.
Key Cons of USDT
- Since the USDT is pegged to the dollar, this cryptocurrency will receive increased attention from government authorities;
- In the event that the dollar is subjected to inflationary processes, the value and reliability of the USDT will also be compromised.
What is USDT cryptocurrency? What other interesting facts do you know? Just share your knowledge in the comments!