If you have already an experience of interacting with the assets and cryptocurrencies for at least once in your life, then you might have quite an understanding of what stablecoin is.
It cannot be denied that Tether is one of the most known stablecoins that are present these days. In this article, I am going to provide you with information about Tether USDT and its advantages as well as its disadvantages.
As long as you will not require your current cryptocurrency to be exchanged into actual fiat money, stablecoins will enable you to have the same function of the cash inside the world of cryptocurrencies, specifically the stability function. Most of you can’t deny the fact that the stability of cryptocurrency is very important in these days where most of the cryptos are unstable.
Some of you knew that Tether is a kind of stablecoin that is being attached to various fiat currencies. On the other hand, USDT is also fixed with the United States dollars and was issued by Tether. This will enable all the traders to send the “fiat equivalent” without requiring the use of the ordinary fiat currency regulation.
In the world of cryptocurrency, Tether or mostly known as USDT is the most dreaded and loved stablecoin out there. Tether has been in the crypto-world not so long ago, with the primary USDT minted way back in 2014.
On the other hand, Tether is one of the stablecoins out there that do not have their own blockchain. However, it has the functions which are similar to the script of Bitcoin as their second-level of currency. Omni Layer is the name of the Bitcoin’s layer atop.
The relationship of Tether with the industry of cryptoasset is usually referred to be as ambivalent. Even though this stablecoin is used by many users, some people speculate that this stablecoin does not give the real US Dollars to the investors and customers. It only means that some users think that Tether is just making printed money!
On the other hand, what makes Tether differ from the other cryptocurrencies, including Ethereum and Bitcoin, is that it is centralized emission and its rate is always equivalent to one US Dollar.
Advantages of Tether USDT
Similar to the other stablecoins in the world of cryptocurrencies, it cannot be denied that Tether has its own advantages and disadvantages that you should know. Thus, I have provided a section that will give you an idea about the pros and cons of using Tether or USDT.
So, without further ado, let’s get started!
Advantages of Using Tether (USDT)
- You can use Tether or USDT in transferring your money over the decentralized networks at a faster and inexpensive rate. Since the stablecoin was established in a way that it could accommodate a value that is equivalent to one US Dollar, it can also be utilized in transferring your money over the different network. The token will maintain the entire key features of a cryptocurrency if the user uses a private wallet that is well-matched on the blockchain network. Thus, there is no transaction fee.
On the other hand, when it comes to the third-party wallet, there will be an additional transaction fee that was fixed by the third party wallet system. It only means that the users are also required to pay the fee for the fiat deposition, which is 1 US Dollar. One of the benefits that you can get from using the USDT network in transferring money is that people will not experience loss of funds because of the market capitation as the fixed USDT value.
- Another advantage that you can get if you will use USDT as your transferring network is that you will have a reselling option that he can get from the platform. Aside from that, you are also allowed to withdraw your USDT. On the other hand, withdrawing your USDT into a fiat currency would have additional fees for bank transfer. As soon as you change your USDT value into fiat, the exchange will delete the token value, so the fiat value change will not be the network’s responsibility. The stable value will be maintained when you are still on your used platform.
Cons of Using USDT
- One of the disadvantages that you can get from using USDT is that the USD isn’t fixed. It only means that a single US Dollar aura will not always remain true. On the other hand, the idea you need to remember is that the level of volatility does not surpass in 2 to 3 percent, but it is not 0.
- Another disadvantage of using USDT is that it does not allow for tether public mining. It is because the company has its right to do so. The reason behind it is not that clear yet, but you can still understand its idea.