Calm markets – eos increases the most of the biggest cryptocurrencies
The world's biggest cryptocurrency bitcoin is currently trading at $3,670, which is around $38 higher than yesterday.
OPINION. The cryptocurrency tether is a so-called stablecoin, supposed to follow the dollar. Lately, this has turned out to be difficult. Trijo News reporter Jan Granroth now thinks tether's days are counted.
The many questions surrounding tether, of which the value always should be one American dollar, keep troubling the crypto community. For my own part, it was a long time ago I stopped using tether due to the many issues.
Tether is a so-called “stablecoin” or “pegged coin” and is a coin which value is meant to be stable and always follow the performance of an underlying asset, such as the dollar in the case of tether. Stability and continuity are always desirable in trading.
Traders who possess crypto assets on an exchange may want to exit their exposure to cryptocurrencies given their very volatile nature. However, many exchanges have problems dealing with fiat currencies, namely ordinary money, since the managing of them requires enormous amounts of bureaucracy, administration, as well as a bank who doesn’t hate cryptocurrencies.
Therefore, a non-volatile cryptocurrency to seek refuge in under stormy days undoubtedly has its advantages, but it is all totally dependent on the assumption that the currency actually stays stable – especially when the wind is of hurricane strength.
Tether has, just like the previous alternatives, obviously failed with this and, thus, also completely lost its raison d’etre. Tether has lately consistently been trading for less than a US dollar, and was a while ago on some exchanges actually traded for as low as 80 cents.
They only ones actually having full confidence for tether is the exchange Bittrex, who always have a fixed exchange rate of 1 USDT = 1 USD. The problem is, however, that the two companies are run by pretty much the same people, making them rather biased.
On most of the other major exchanges, tether is being traded for less than a dollar, so consequently, the actual market price is not one dollar. To claim that a tether is worth one US dollar is quite far from reality.
There are also several alternatives to tether, such as the newly added gemini, but this coin already traded for a premium of as much as 20 percent some time ago, and can thus not be considered stable.
“Do yourself a favor and use real fiat currency”
It is also easy to see how big the financial incentives are for Tether and other companies to take shortcuts, given the lack of transparency. If one starts to think about how much Tether could earn by, instead of keeping the funds used as collateral deposited, invest them, one soon realizes their desire to put the funds in use – especially if trouble arises in the ordinary money flows and credit lines.
After all, many fiat currencies are pegged to other currencies, mostly the dollar, and even they are having problems with keeping the fixed rate, and probably a powerful national state is in a better position to succeed in this than a crypto company.
Do yourself a favor and use real fiat currency if that’s what you want to own – despite the extra hassle. There are exchanges such as Coinbase Pro which offer fiat trading, to low rates as well.
Crypto, as well as traditional trading, has enough risks in general, so to that add a counterparty risk in the form of a more or less non-transparent crypto company is surely not to recommend. Particularly given that all similar attempts have failed so far.
And bear in mind that even Ponzi schemes work perfectly fine. Until they don’t.
Reporter at Trijo News
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