The Rise and Fall of Tether’s Stable Currency USDT: An Overview

04/24/2023 00:43 • Tech Ticker • 151 views

According to reports, according to CoinMarketCap data, the total market value of Tether’s stable currency USDT has reached $81.4 billion. According to Bloomberg, in May last year, when the Terra crash prompted investors to sell cryptocurrencies comprehensively, the amount reached a peak of approximately $83 billion. Tether’s assets decreased by nearly 20% in the second quarter of 2022. In the face of successive setbacks to USDC and BUSD this year, USDT is about to recover to its full market value before the Terra algorithm’s stable currency crash.

Data: USDT’s total market value of $81.4 billion will recover to its pre Terra crash market value

Introduction

According to CoinMarketCap data, the total market value of Tether’s stable currency USDT has surpassed $81.4 billion. However, this success comes after a turbulent period where USDT experienced a decrease of almost 20% in assets in the second quarter of 2022. In this article, we will discuss the history of USDT and its recent struggles.

What is Tether’s stable currency USDT?

Tether is a stable currency anchored to the US dollar, that is designed to maintain a steady value of $1 per token. It was introduced in 2015 by Tether Limited, a company that claims each token is backed by a US dollar stored in a bank account.

The Rise of USDT

USDT’s market value reached a peak of approximately $83 billion in May 2021. This occurred when the Terra algorithm’s stable currency crash prompted investors to sell cryptocurrencies comprehensively. USDT became the go-to currency for investors, who saw it as a reliable and low-risk investment.

Struggles and Setbacks

However, the rise of other stable currencies such as USDC and BUSD provided stiff competition for USDT. In the second quarter of 2022, USDT experienced a decrease of almost 20% in assets. In addition, USDT has recently faced some skepticism from investors over the transparency of the company’s bank accounts that supposedly back each token.

The Road to Recovery

Despite these setbacks, USDT remains one of the most widely used stable currencies in crypto trading. Analysts predict that USDT is about to recover to its full market value, eclipsing its competition USDC and BUSD. This comeback can be attributed to the trust of the currency by investors and the company’s efforts to be more transparent about its financial transactions.

Conclusion

The rise and fall of Tether’s stable currency USDT are a testament to the volatility of the cryptocurrency market. While USDT is currently facing challenges from its competitors, its success over the years shows it can adapt and remain a critical player in the rapidly changing world of cryptocurrency.

FAQs

Q: Can I buy USDT with regular currency?
A: Yes, USDT can be purchased with regular currency on several exchanges.
Q: How does Tether ensure that each token is backed by a US dollar?
A: Tether Limited claims that it holds reserves in its bank account that equal the total number of USDT issued.
Q: Can the value of USDT fall below $1 per token?
A: It is unlikely but not impossible. USDT’s value is anchored to the US dollar, and any sudden fluctuations in the dollar’s value could affect USDT.

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