Cryptocurrencies have consolidated as viable and profitable investment vehicles. Major cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) are effective hedges against inflation. However, despite their many advantages, some inherent characteristics of these digital assets prevent their mass adoption. One of the most significant obstacles is price volatility.
JOIN US FOR MORE ON:
or
or Follow us on WhatsApp Channel
Usually, the price of a cryptocurrency varies widely over a short time. This phenomenon makes the daily use of cryptocurrencies impractical. For example, you may go to the supermarket with enough digital coins to buy a few products you need. But if your coins devalue while you are on your way, you will find out at the supermarket that you cannot pay for all your products.
Of course, the opposite can happen too. If your digital coins appreciate, you’ll have money to buy a few extra products. However, most people prefer to have some certainty about the value of their coins to avoid surprises. Some cryptocurrencies, known as “stablecoins,” can solve this problem.
The value of a stablecoin is pegged to the value of a stable asset like a currency (American dollar, for example), a commodity (gold or silver, for instance), or something else. The first stablecoin to ever exist was Tether (USDT). But what is USDT? Does it effectively solve the problem of price volatility? Should you invest in this digital asset? Let us discuss it in detail.
Tether (USDT) Explained
As mentioned, USDT is a stablecoin that mirrors the value of the American dollar (USD). It means that 1 USDT can be exchanged for exactly $1. Tether, a company based in Hong Kong, issues this stablecoin. To peg the value of USDT to the USD, Tether holds a reserve of commercial paper, fiat-money deposits, and other assets that equal the USD value of the USDT coins in circulation. As of the last days of March 2022, over 81.6 billion USDT coins were in circulation.
However, some experts believe that Tether may not be backing USDT fully. To dissipate these doubts, Tether released its attestation report. While the report showed that all the USDT coins were backed, cash reserves backed only 3.9% of them. In contrast, 65.4% of these coins are backed by commercial paper. Tether does not share information about these short-term loans made to corporations.
So, should you invest in USDT? The decision is yours. Tether has never denied redemption to a single customer who has asked for it. Hence, one can consider it safe. Alternatively, you can consider investing in a different stablecoin. There are many options available!
Make Money with Cryptocurrencies Using One of the Best Crypto Faucets
What can you do if you want to invest in cryptocurrencies but don’t have capital? You can use one of the best crypto faucets! Not familiar with the term? No problem, we will explain it here. A cryptocurrency faucet is an application or a website that pays users for doing simple tasks. The said payments are in digital coins. So, what tasks are we talking about? Solving captchas, viewing ads, watching advertising videos, clicking links, you name it!
You will not get a considerable amount of crypto per task. However, over time, you will accumulate your payments in a micro-wallet. The crypto faucet will create the said micro-wallet automatically after you sign up. When you reach a predefined minimum amount, you will be able to withdraw your funds. Alternatively, the micro-wallet will send your funds to your wallet when it becomes full. To make this activity profitable, you have to utilize several crypto faucets simultaneously.
Originally posted 2022-04-04 18:12:24.