- Tether is set to become the second-largest crypto
- USDT has been surrounded by a lot of controversies
- Tether represents what many so-called cryptos aren’t
Cryptocurrency News Today – according to a new report, Tether is set to become the second-biggest crypto by market cap by early next year. The world of stablecoins has more than doubled in recent months. It looks like the average traders and retailers have been stockpiling stablecoins. Even video game company Atari, has announced plans to go into crypto and unveil its stablecoin soon.
This coin will be used for in-game purchases and events. The interesting thing about stablecoins is the fact that they are cryptos tied to fiat like the USD, euro, yen, and yuan. This is done to help stablecoins avoid volatility (which has been a problem in the crypto space). Many assets, like Bitcoin and Ethereum, remain vulnerable to volatility. This has caused many losses for traders.
Tether is a Controversial Cryptocurrency
In 2018, the price of Bitcoin dropped from about $20,000 per unit down to about $3,500. This change occurred between December 2017 to mid-2018. That’s a loss of $17,000 out of the total price (peak position) of BTC. This implies that volatility isn’t a minor issue at all. Volatility has made many traders become digital paupers overnight. Some claim that the stablecoin Tether isn’t backed by the USD.
Additionally, it is widely believed (based on a report published by a finance professor at the University of Texas, John Griffin) that Tether’s USDT is responsible for the drop that occurred in Bitcoin in 2018. The digital currency was allegedly pegged to BTC because many people used it to buy BTC when the latter showed signs of slipping in 2017.
“Tether Represents What Many So-Called Cryptos Aren’t”
One year on, users began to feel that they had purchased more than enough Bitcoin and now had a bit of money to show for it, they moved on from the Bitcoin space. They did this in a classic take-the-money-and-run fashion. Before the top digital asset started to recuperate it took many months. Mike McGlone the senior strategist at Bloomberg explained about Tether in a statement:
“Tether represents what the bulk of the so-called cryptos aren’t. It is a stable form of payment. It indicates demand for a digital gold (BTC) and a digital asset like the USD. If the current trend prevails, the total market cap of Tether’s USDT may surpass that of Ethereum by next year. It will take something huge to stall Tether’s increasing adoption.”
Tether Limited’s chief technology officer Paolo Ardoino, has assured investors that Tether’s USDT isn’t looking to replace Bitcoin at the top. Rather it is complementing it.