Trying to decode the reliability of Tether.
Gaining stability in the cryptocurrency market was very crucial, as volatility has always been haunting the cryptocurrencies space. All the investors as well as daily traders make use of the volatility, in order to make profits out of it, at certain point of times it is very crucial to have stability within the cryptocurrency market, for many cryptocurrencies have been developed in order to mitigate the stability but most have been most of them have been prone to the volatility attacks of the uncertainties due to cryptocurrencies in the market. The original vision of Satoshi Nakamoto, of developing and commercializing a decentralized financial economy has become or is in the process of becoming a reality, but one thing is for sure that even he wouldn’t have imagined the scale and pace at which the cryptocurrencies has been expanding within the past decade. Let’s read about the first stable coin in the cryptocurrency world: Tether and see if it is really reliable?
Tether or USDT is one of the most popular cryptocurrencies developed in order to provide stability within the cryptocurrency market it is its working functionality is such that the value of 1 USDT is always maintained somehow with that of 1 US dollar. The need for the stable coin in the cryptocurrency market is very much, as an immense amount of losses used to happen before the invention of Tether, due to a slight amount of price slippage issues. Tether has been the most popular stable coin, apart from many of its counterparts in the cryptocurrency market.
Why was Tether required?
It was said that it was it is not safe enough to keep your cryptocurrency friends on the exchange itself in the form of an online wallet but preferred that they transfer the amount to their personal hardware wallets. But, as the network gets busy the transaction takes longer time and hence due to price slippages, the investors had to face a huge amount of losses but this is where the stable coins like tether come into the picture. The users can easily convert their volatile cryptocurrencies into a nonvolatile Tether cryptocurrency and can effectively avail the profits without any slippage losses.
Claims by Tether officials
According to the professionals, all amount of Tether is backed by the same amount of US dollars in the bank or indirectly we can say that this particular cryptocurrency entails the features of a fiat currency but along with the powers of Blockchain technology. The Tether Blockchain platform was actually initiated by the same person who is the man behind the cryptocurrency exchange, Bitfinex. However, high amounts of speculations as well as accusations hover around Tether, as it is speculated to be a scam. To be very specific, not a single authority has confirmed that the cryptocurrency blockchain platform is really backed by an equivalent amount of Fiat currency is deposited in the Bank. On the contrary, it is just their cryptocurrency website that claims to be highly reliable and trustworthy.
Is Tether reliable?
According to them, the reserves are audited on a consistent basis by professional auditing experts. Friedman LLP happened to be their first auditors,. The Tether blockchain platforms seem to have a relationship with some of the major banks across the world like Puerto Rico and ING. The huge amount of bank deposits within a duration of one year that Puerto Rico experienced, is roughly equivalent to the total amount of data distributed within the cryptocurrency space, this can be considered as a legitimate but ambiguous explanation of the reliability of Tether tokens.
Nothing can be predicted with respect to the trustworthiness of the Tether blockchain project. It is very common in the cryptocurrency space to consider any fraudulent company to be innocent until and unless it reveals its true colors before everyone. The situation seems to be very ambiguous and unclear when it comes to the legitimacy of the coin. Any government or any professional auditing organization must raid into the offices and force the people to open their ledger and reveal the proofs of their reliability. Or we just might not be aware, at any point of time that the project might actually be a scam.