Cryptocurrency

Tether (USDT) No Longer Supports Its Stablecoin Against USD

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Tether has been controversial crypto since its introduction. It was also the first crypto to come up with stablecoins, which are claimed to be backed by one United States dollar. However, they might be redeemable through the Tether ecosystem. Tether or USDT is designed in such a way that it would always maintain the value of $1.00. But recently, on 14th March Tether changed its backing and has included loans to affiliate.

Tether has claimed that its USDT tokens are not only backed by fiat currency and cash equivalents but also “other assets receivables from loans made by Tether to third parties.” What makes it a piece of worthy news is the fact that many investors in the crypto market are using Tether to hedge against the unpredictability of the crypto.

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Though at present, Tether is the largest stablecoin in the market, it is facing tight competition from other companies which are coming up with their own stablecoins.

Tether’s market capitalization volume worth $2.03 billion makes it the 8th largest cryptocurrency in the overall crypto market. Which means the currency is ahead in the market than known coins like Monero, Bitcoin SV, MiOTA, Tron and Dash.

Tether stablecoin users believe that their stablecoin is managed against the real USD which are stored in the banks. Official statement of Tether says,

“Every tether is always 100% backed by our reserves which include traditional currency and cash equivalents and, from time to time, may include other assets and receivables from loans made by Tether to third parties, which may include affiliated entities.”

Going ahead Tether also cleared that it holds all the rights to delay the redemption of stablecoins or their withdrawal if the liquidity of the reserves in Tether’s account demands so.

Here are the other crypto coins which have come up with their stablecoins and are now competing with each other:

TrueUSD, Gemini USD, and USD Coin.

TrueUSD was introduced in the market in March 2018. Since then it has issued one to three attestation reports with the help of Cohen & Company. As per the audit was undertaken in the previous month on 28, the company holds 201,727,658 TrueUSD which are backed by $202,621,765 worth dollars.

USDC creator Circle has also revealed its fourth attestation report, in which it is disclosed that Circle holds 307,7903,924 USDC tokens which are backed by 397,848,312 dollars; inclusive of the sum of all the dollars held in different custody accounts.

One more company named Paxos, which has Paxos Standard Token Stablecoin, also called as PAX, has published a report in which it has claimed that it holds equal or over $109,543,189.7 on its account.

Roxanne Williams

Roxanne Williams has recently joined as a market reporter for CryptoNewsZ - the 24/7 crypto news site, where she produces recent stories, technical analysis and price updates on world's leading cryptocurrencies.

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