Investors can face volatility in the prices of cryptocurrencies at any time. Tether was designed to reduce volatility in the prices. You might be thinking about Tether! Like what exactly Tether is? This guide will help you to know about Tether completely.

What is Tether?

Tether is a cryptocurrency belonging to a new breed of cryptocurrencies called Stablecoin. It is backed by an equivalent amount of fiat currencies. The fiat currencies can be USD, EUR, YEN, etc. If Tether is backed by an equivalent amount of USD, then USDT will be formed. USDT is known as Tether token. Building a bridge between cryptocurrencies and fiat currencies is an objective behind the designing of Tether. Another objective was to provide stability, transparency, and minimal transaction charges. Tether is built upon the top of an open blockchain technology secured cryptographically. Global government laws are obeyed by Tether.

History

2012 is the year when a whitepaper was published online. Building new currencies on the top of the Bitcoin Protocol is a possibility described by a software developer called  J.R. Willett. He took efforts for the implementation of this idea in a cryptocurrency called Mastercoin. The cryptocurrency Mastercoin was having an associated foundation called the Mastercoin Foundation for the promotion of this new “second layer” usage. The Mastercoin Foundation was renamed as Omni Foundation later on. 

The technological foundation of Tether would be the Mastercoin protocol. The co-founder of Tether would be an original member named Brock Pierce of the Mastercoin Foundation. Another co-founder of Tether would be the Chief Technology Officer (CTO) Craig Sellars of the Master Foundation.

In July 2014, the co-founders Brock Pierce, Reeve Collins, and Craig Sellars of Tether had made announced a precursor to Tether called Realcoin as a Santa Monica-based startup. The Bitcoin blockchain is the place where the first tokens had been issued in October 2014. The Omni Layer Protocol was used to do this. In November 2014, the Chief Executive Officer (CEO) of Tether Reeve Collins had made an announcement of renaming this project as Tether. Another announcement was also made. It was regarding entering into a private beta. A “Tether+ token” was supported by the private beta for three currencies. USDTether (US+), EuroTether (EU+), and YenTether (JP+) are the three currencies. 

The company is incorporated in Hong Kong, a Chinese special administrative region. It has offices in places like Switzerland.

2015 is the year when a cryptocurrency exchange called Bitfinex enabled Tether trading. It was said that these two entities are separate. The Bitfinex officials Philip Potter and Giancarlo Devasini are the two names mentioned in a set of 13.4 million confidential electronic documents called Paradise Papers which were leaked in November 2017. They were stated to be responsible for the establishment of Tether Holdings Limited in the British Virgin Islands, a British Overseas Territory. Jan Ludovicus van der Velde was said to be the CEO of Bitfinex and Tether. 

Tether Holdings Limited owns a Hong kong-based Tether Limited according to the website of Tether. Bitfinex is recognized as one of the world’s largest Bitcoin exchanges by volume. 

US dollar transactions were processed by Tether with the help of Taiwanese banks for some time. A financial services company called Wells Fargo was used to send the money in turn so that the funds can move out Taiwan. 

The Omni Foundation and a computer scientist named Charlie Lee had made an announcement on June 2017. Charlie Lee is the creator of the cryptocurrency Litecoin. The announcement was related to issuing of Tether. The Omni Layer of Litecoin is the place where Tether would be issued.

2017 is the year when Tether had also made an announcement. The announcement was related to the launching of additional ERC-20 tokens for fiat currencies like USD and EUR. The Ethereum blockchain is the place where the additional ERC-20 tokens would be launched. Tether has made a confirmation later on. The confirmation was related to the issuing of Ethereum tokens. The Ethereum tokens had been issued. USDT on the Omni layer of Bitcoin, EURT on the Omni layer of Bitcoin, USDT as an ERC-20 token, and EURT as an ERC-20 token are four Tether tokens. An amount of Tether was almost $2.8 Billion in January 2017. While an amount of Tether had reached almost $2.8 Billion in September 2018. Tether was accounting for almost 10% of Bitcoin’s trading volume at the beginning of 2018 while Tether was accounting for up to 80% of Bitcoin’s trading volume during the summer of the same year. 

Working Of Tether

Tether uses the Omni Protocol to exist on a blockchain. It exists as ERC20 tokens on the blockchain. 

Omni is defined as a protocol built as a layer over Bitcoin. Users can generate, send, trade, redeem, and pay dividends using Omni Protocol. 

ERC20 is defined as a technical standard used for smart contracts on the Ethereum blockchain for the implementation of tokens. The full form of ERC is Ethereum Request For Comments and 20. While 20 stands for a unique ID number. The main purpose of the unique ID number is to distinguish the standard from others.

You can’t just redeem Tether, but you can also exchange Tether. 1 tether USD₮ = 1 USD is the conversion rate. One can either redeem or exchange Tethers in accordance with Tether Limited’s terms of service.

Using the Bitcoin network in the form of transport protocol was a purpose behind the creation of Tether. The creation of Tether was done originally for the purpose. It was also created for the use of the Omni Layer specifically. Mastercoin is the former name of Omni Layer. Omni Layer isn’t only defined as a digital currency, but it is also defined as a communication protocol built on the Bitcoin blockchain. Customers can perform transactions of tokenized traditional currencies. The Bitcoin blockchain is used by the original version of Tether. The stability and security are provided inherently from the longest established blockchain network. Tether is recognized as a newer transport layer of an Ethereum blockchain. Tether can’t just be used in Ethereum smart contracts, but it can also be used in Ethereum Decentralized Applications (DApps). You can send Tether in the form of an ERC20 token to any Ethereum address.

Two transport protocols (Bitcoin and Ethereum) are used by Tether at the current. Alice decides to send Tether to Bob. Alice checks the address of Bob carefully for the confirmation of the destination address and the selection of the correct transport protocol because the destination address can either be in a standard Bitcoin or a standard Ethereum format.

Businesses Use Tether

Businesses related to exchanges, wallets, payment processors, financial services, and ATMs can use Tether. They can use fiat currencies on blockchains with the help of Tether. Changelly, Bitfinex, Poloniex, Ambisafe, HolyTransaction, Kraken, Bittrex, HitBTC, Mobi, BtcTurk, BTCTrader, Freewallet are some of the businesses which use Tether. If an individual wants to transact with Tethers, so they can just simply use Tether-enabled platforms. Tether can be made used in places where digital currencies are used. It can also be made used in places where digital currencies are not accepted at the current.

Purpose Of Tether

Tether is defined as a secure and transparent money created for the Internet. It is pegged by an equivalent amount of fiat currencies like USD, EUR, and Yen. Customers can send, receive, and store Tether tokens on blockchains. Protecting customers from the price volatility is an aim behind Tether. 

Tether Wallets

Tether wallets are used to store and secure your wallets.

1. Hardware Wallets: Ledger Nano S Wallet, and Ledger Nano X Wallet

2. Desktop Wallets: Atomic Wallet

3. Mobile Wallets: Coinomi Wallet

4. Web Wallets: MyEtherWallet and OmniWallet

Tether provides its own wallet ie., Tether Wallet to support USDT.

Cryptocurrency Exchanges

  • CoinSwitch: It is based in Bangalore, Karnataka, India. It was founded in 2017. Ashish Singhal is the CEO and founder of CoinSwitch. CoinSwitch supports fiat currencies like US Dollar (USD). It supports payment options like Credit card and Cryptocurrency. Customers can buy, sell, and trade cryptocurrencies. 
  • Bitfinex: It is headquartered in Hong Kong. It was founded in 2012. Jean-Louis Van Der Velde is the CEO of Bitfinex. While Giancarlo Devasini and Raphael Nicolle are the founders of Bitfinex. iFinex Inc. is a FinTech company who owns and operates Bitfinex. It supports fiat currencies like US Dollar (USD), Euro (EUR), Pound Sterling (GBP), and Japanese Yen (JPY). Bitfinex supports payment options like Cryptocurrency and Wire transfer. Customers can buy, sell, and trade cryptocurrencies.
  • Stellarport: It is headquartered in San Francisco, California. It was founded in 2018Ishai Strauss is the CEO and co-founder of Stellarport. Stellarport supports payment option like Cryptocurrency. Customers can buy, sell, and trade cryptocurrencies. 
  • KucoinIt is headquartered in Singapore. It was founded in 2017. Michael Gan is the CEO and co-founder of KuCoin. KuCoin supports payment option like Cryptocurrency. Customers can buy, sell, and trade cryptocurrencies.
  • Remitano: It is incorporated in Seychelles, Country in East Africa. It was founded in 2014. Dung Huynh is the CEO and co-founder of Remitano. Remitano supports fiat currencies like United Arab Emirates dirham (AED), Argentine peso (ARS), Australian dollar (AUD), Bangladeshi taka (BDT), Brunei dollar (BND), Bolivian Boliviano (BOB), Brazilian real (BRL), Canadian dollar (CAD), Dominican peso (DOP), Swiss franc (CHF), West African CFA Franc (XOF), Central African CFA franc (XAF), Renminbi (CNY), Danish krone (DKK), Euro (EUR), Algerian dinar (DZD), Pound Sterling (GBP), Ghanaian cedi (GHS), Indonesian rupiah (IDR), Israeli new shekel (ILS), Indian rupee (INR), Japanese Yen (JPY), Kenyan shilling (KES), South Korean won (KRW), New Zealand dollar (NZD), Norwegian krone (NOK), etc. It supports payment options like Bank transfer and Cryptocurrency. Customers can buy and sell cryptocurrencies.

Market

Tether is one of the top-10 cryptocurrencies. At the time of writing, the market cap and price of Tether are $4,023,556,683 and $0.995086 respectively. While the volume and circulating supply are $18,883,079,718 and 4,043,425,265 USDT respectively. 

Pics Credit: Google/Cryptonewsz

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