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What is Tether? Is USDT good for investment?

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Tether is usually denoted by USDT on many of the cryptocurrency exchange trading pairs and is confused with the US dollars.

Understanding the qualities of Tether.

Introduction

Among the suite of cryptocurrencies, Tether is one of the most prominent ones. Therefore let’s understand some of its characteristic attributes which makes it so. It is usually denoted by USDT on many of the cryptocurrency exchange trading pairs and is confused with the US dollars. Even if you assumed so, then you can be considered as partially right, as the USDT is the cryptocurrency version of the US dollar. Its value is precisely fixed to the value of US Dollars, hence it is said to be tethered to the US dollars.  Its value is so staunchly attributed to the to US dollars that it is estimated to be not more not 1 cent more or 1 cent less the actual value of the USD. As we all are very familiar with the fact that, the theory is far away from practicality. Hence the value of Tether is not exactly the same as the value of USD.

 

Similar to the US dollars even Fiat currencies of some of the most prominent countries of the world are looking forward to developing their respective Tether coin. for an instance, the European dollar is denoted by EURT, and Japanese Yen to be represented as JPYT.

Why do they exist?

In order to jump onto the cryptocurrency trading bandwagon, one must have cryptocurrencies handy, as many exchanges do not support the Fiat currencies. Hence it plays an important role, as it is supported by most of the cryptocurrency exchanges. One can get the US dollars converted to Tether on Kraken easily.

It is worth mentioning, that Tether is a completely Centralised form of cryptocurrency and at any point of time, the price of cryptocurrency might completely vanish off.

Although the cryptocurrency is more or less exactly similar to the US dollars itself then one might be wondering, why the cryptocurrency form of the Fiat currency is useful? There are there are a number of characteristic attributes which makes Tether highly useful in cryptocurrency domain. They are.

Reduced Transaction time

Imagine if some user wants to convert his cryptocurrency into the US dollars and needs to withdraw it. It is no wonder that it would take a longer time for the transaction to get executed. If the banks are closed due to public holidays and other events, the transaction type might increase up to days together, on the other hand, the transactions in case of Tether coin is settled within a couple of minutes as the whole system is online.

No transaction fees

The traditional US dollar transfers which take place throughout the world is undertaken with the SWIFT (Society for Worldwide Interbank Financial Telecommunication) protocol. The protocol levies a percentage of the transaction, fee starting from $20 and adding on to that, a number of other fees such as Forex exchange fees are added which makes the transfer highly unaffordable. On the contrary, the transfer of USDT between the cryptocurrency wallets throughout the world is almost free of cost.

Stable currency

If a daily trader, uses some other cryptocurrency apart from USDT, in order to halt their trading, then due to the high volatility of the Altcoins, price slippage may occur, and unnecessary complications for the trader is increased. As the coin is already stable it is one of the most preferred one by the traders.

Faster access

It has been well understood from the cryptocurrency exchange hacks that have occurred in the past few years that a user must safeguard his funds by storing them on his personal wallet and not leaving them on the cryptocurrency exchange, so as to avoid vulnerability. Also, imagine is Tether wouldn’t have existed. Then the users would have needed to convert the Crypto into the US dollars to keep away from the exchange. Again, if the user needs to resume trading, then transferring the Fiat currency through wire transfer would take days together, which can instantly happen in case of USDT.

Is Tether good for investment?

If long-term profits are expected by the investors out of Tether, then he is in a wrong notion. As it was earlier explained, that the value of USDT is pegged on to the US Dollars, it is obvious that the value wouldn’t be gaining or losing value. However due to its Centralized nature, to an extent, a downfall might be expected. In a nutshell, it is not a good investment for profits.

#Exchange

5th Largest Korean Cryptocurrency Exchange: Coinnest Shuts Down

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Coinnest which is one of the largest cryptocurrency exchanges in Korea made an announcement that it is going to shut down its operations in the midst of some financial, admin and legal problems.

 

Coinnest Shuts Down:

According to a recent publication by Coinnest, bitcoin exchange, the exchanges is shutting down its operations. Coinnest had earlier closed down its new account creation services on 16th April 2019.

 

According to the exchange, it is going to terminate the trading and deposit features at the end of this month. However, the users shall be able to withdraw their cryptocurrencies from the exchange until 30th June 2019.

 

coinnest-screenshot

website screenshot

 

Following the decision to shut down its operations, the exchange has made an announcement regarding the decrease of the minimum withdrawal amount as well the withdrawal fees. Coinnest warned the users that no user shall be able to withdraw their funds after 30th June 2019.

 

Last year, the CEO of the exchange, Kim Ik-hwan was arrested by the South Korean police for fraud and theft. Since then, the exchange had been facing a bad time. The CEO was found guilty by the court and was sentenced to prison along with a fine of $2.5 million.

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Japan to establish new regulations for cold wallets of crypto exchanges

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The Financial Services Agency of Japan (FSA) is going to establish new regulations in relation to the cold wallets of cryptocurrency exchanges.

As reported by Reuters, the Financial Services Agency of Japan (FSA) is going to establish new regulations in relation to the cold wallets for the storage of cryptocurrencies for cryptocurrency exchanges.

 

According to the report, the financial regulator of Japan is going to need a more strict internal supervision of the cold storage wallets (offline wallets) within the crypto exchanges.

 

The Financial Services Agency of Japan is going to mark the issues of protecting the security of the cryptocurrencies and other endangers to the country by establishing new regulations since the agency wants to uplift the fintech industry in order to encourage the economical growth.

 

Even though the cold storage wallets are in offline mode (not connected to the internet) and are considered a lot safer than the online wallets, Japan’s Financial Services Agency is considering the internal thefts within the organization itself. Currently, a lot of cryptocurrency exchanges do not have a procedure of rotating the individual responsible for the cold storage wallets.

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Kraken Sued for $907,000 by ex-Employee

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An ex-employee of Kraken, Jonathan Silverman has sued the crypto exchange for failing to make the payment for his work done for the company.

An ex-employee of Kraken, a major cryptocurrency exchange, Jonathan Silverman has sued the crypto exchange for failing to make the payment for his work done for the company. The lawsuit has demanded more than $900,000 from the company.

 

Kraken Sued:

According to a publication on Bloomberg, Jonathan Silverman was responsible for managing the institutional sales and trading desk of the exchange. He was posted in New York and had an agreement with Jesse Powell, the CEO of Kraken for a salary of $150,000 for his job. They also had verbal communication regarding the payment of 10% of the yearly profit of the desk to Jonathan.

Jonathan is alleging that the desk had made more than $19 million profit in 3 months during his working period in 2017 and did not receive the 10% payment as a commission as he was promised.

However, according to Christina Vee, one of the spokeswomen for Kraken mentioned that Jonathan Silverman is giving false statements and also violating his confidential agreement.

 

Did Kraken leave New York in 2015?

Jonathan Silverman also claims that Kraken had not left New York in 2015 despite the fact that the controversial Bitlicense was introduced by the State’s department of financial services back then. He said that the company has been misleading the common people and the government regulators about not operating in New York since 2015. Jonathan claims that most of the OTC (Over the counter) traders of the exchange were done in New York.

In 2015, Kraken had posted an official publication which said that the exchange is shutting down its services in New York due to the controversial BitLicense of the State that was being brought out by the financial services department.

 

The lawsuit claims that when he left the job, Jonathan Silverman had reached an agreement with the company that he would receive $907,000 as a settlement amount which was never received by him.

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