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Digital currencies are a substitute for fiat chiefly because of their decentralization, among other reasons. However, the volatile nature of digital currencies is a major setback that discourages investors from buying, or holding, digital currencies. To solve this problem, stablecoins were created to evade volatility and remain stable, as their name implies. This article discusses USDT, one of the top stablecoins, and provides a comprehensive guide to buying some for yourself.
Our Preferred Exchange for Buying Tether
If you want to buy USDT, using exchange platforms that give you the best rates and a stress-free experience would be best. While there are several exchange platforms, here are our favorites;
Crypto, Credit Card, Bank Transfer, Debit Card
4. Prime XBT
Advantages and Disadvantages of Tether
- Stability: Tether’s main advantage is that its value is not subject to the same volatility as other cryptocurrencies—it will not fluctuate when the market fluctuates. This allows users to hold Tether without worrying about losing their money due to market fluctuations.
- Reliability: Tether is a cryptocurrency backed by fiat currency, which means you can exchange your Tether for dollars, euros, and other currencies, making it more stable than other cryptocurrencies since it’s not subject to the same unpredictability as other coins.
- Low Transaction Cost: Even compared to other chains that provide similar services, Tether has lower transaction costs – sometimes as low as $0.01 per transaction! This makes the network more accessible for everyday users and small businesses than blockchain networks like Bitcoin or Ethereum.
- Cost: Tether is less expensive than other cryptocurrencies, making it appealing to those who want to invest but don’t want to spend much on the process.
- Accountability: The Tether company has not been able to do a public audit of the stablecoin, meaning that the dollar backing could be hearsay.
How Does Tether Work?
Known initially as Realcoin, Tether was launched in 2014 on the Omni Protocol by Brock Pierce, Reeve Collins, and Craig Sellars. The stablecoin was designed to allow users to hold and buy digital assets on the blockchain without being affected by market volatility. This means that Tether can be bought with fiat currency, and users get to enjoy other advantages like transparency, low transaction fees, and stability.
In lay terms, Tether solves the problem of fiat and cryptocurrencies by merging their advantages. To achieve this, each Tether in circulation is pegged to an asset with at least $1. Theoretically, there are about 69 billion Tether on the blockchain, meaning there would be about $69 billion worth of dollar assets in Tether reserve.
This reserve ensures that if every user wants to get their money back, there is an asset that it can be exchanged for. It can also be used to buy any cryptocurrency on Tether-supported blockchains like Bitcoin, Tron, Algorand, etc.
How Can I Buy Tether?
Choose exchange platform: We list our favorite crypto exchanges at the beginning of this article. You can choose from any of them and open an account to get started.
Deposit money: You need to decide the amount of USDT you want to buy and deposit that amount in your account with your chosen cryptocurrency exchange platform.
Buy Tether: Once you have deposited the money in your account, you can exchange it for USDT, and the price of $1USDT will most likely equal $1.
Store the Tether: Keep the Tether in your wallet till you are ready to change it back to fiat or exchange it for cryptocurrency. You can leave it in your crypto wallet or a cold wallet.
Why Is Tether Unique?
The main thing that makes Tether unique is its backing by the US dollar—it’s a cryptocurrency with real-world value. This means you can use it as a stable store of value when other cryptocurrencies fluctuate. It can also be used to trade and transfer funds between your cryptocurrency wallets without converting them into fiat currencies first.
Another thing that makes Tether unique is that it isn’t mined like other cryptocurrencies such as Bitcoin or Ethereum. Instead, it is minted on the Tether platform (known as “authorized participants”). Each minted USDT token is backed by one US dollar held by these authorized participants: the idea being that if you wanted to redeem your tokens for US dollars, they would be able to do so without any problems because there would be enough US dollars available on hand to cover all redeemed tokens at all times.