By
Chimamanda U. Martha
April 25th, 2024
Tether has issued another 250 million of its eponymous tokens and has become one of the world’s 10 largest cryptocurrencies.
Popular Tether’s stablecoin, USDT, that is backed by physical USD at a 1-to-1 ratio, has long been considered rather controversial in the cryptocurrency community. Recently, the company has issued another 250 million tokens, which has only boosted the discussion surrounding this often controversial crypto asset.
Tether’s token is backed by actual fiat currency assets. One USDT is equal to one underlying unit of the currency backing it (in the case under consideration we are speaking about US dollar). Being anchored to the physical world currency, Tether is said to provide its holders with real protection from the volatility of the crypto market.
Tether allows exchanges, wallets, payment processors and other businesses to utilize fiat-backed tokens on blockchains. Owing to blockchain technology, individuals have an opportunity to store tokens and use them in peer-to-peer payments globally. However, for quite a long time some users have had serious doubts about the legitimacy of the project.
At the end of March, when 300 million tokens were released, it resulted in a small price increase of Bitcoin. That’s why some experts expect that now the recent issuance of 250 million USDT tokens may also lead to Bitcoin price changes.
It’s also worth mentioning that the issuance of 300 million USDT tokens was widely criticized, and a lot of people insisted that the authorities had to carry out an official audit of the company to confirm the legitimacy of its claims that this token is backed by fiat.
In such a way, quite recently, the U.S-based law firm called Freeh Sporkin & Sullivan LLP has released a report that confirmed that Tether really has the US dollar reserves to back tokens.
Meanwhile, Tether has reached a market cap of $2.69 billion dollars and, according to CoinMarketCap, at press time, is traded for $0.999.
The share of USDT trading on the market increased to over 22% after the latest printing. More than 30% of USDT tokens that are being traded are currently flowing into Ethereum (ETH). 25% of all ETH trading operations are carried out in pairs with USDT.
Currently, experts do not have any precise understanding where the newly issued USDT would be spread. Traditionally, USDT tokens were actively traded on Binance, but now the situation may change as at the moment CoinBene is trading USDT much more actively. OKEx holds a large USDT wallet as well.
Last year, Tether’s tokens were allocated directly for Bitcoin trading, but today they are quite often spread to altcoins transactions, which may lead to their price changes.
Due to the downs in some altcoins’ prices, the USDT digital asset has now entered the top 10 of coins on CoinMarketCap, having displaced TRON (TRX) and IOTA. Now USDT is No. 9 and it is being traded rather actively with the trading volume making more than 2 billion dollars over the past 24 hours.