What problem does Tether solve?
Founded: 25. February 2015
One of the biggest limitations the cryptocurrency technologies battle is the huge price swings in their valuations which render them slightly impractical for day-to-day trading. Keeping this concern in mind, a new breed of cryptocurrency known as stablecoins was introduced. Stablecoins are backed by real-world fiat currencies like the US Dollar or Japanese Yen. Tether (USDT) is a Blockchain cryptocurrency backed by the US dollar (Blockgeeks, 2018).
Tether was created with the sole intention of introducing a Blockchain-based cryptocurrency that will be stabilized so that it becomes a recognized and accepted means of exchange rather than a tool of investment. It is essential to tackle the problem of wide price swings if we want to see a future where cryptocurrencies could be used to run day-to-day business transactions. Tether aims to achieve that. Its fixed-price follows that of the US Dollar, which provides an incentive to the masses to spend token rather than ‘HODL-ing’ them (Frankenfield, 2019).
99Bitcoins: What are Stablecoins? What is Tether?
What is Tether
What does the cryptocurrency Tether actually do?
Tether is a token issued on the ‘Omni-layer’ in the bitcoin network. The Omni protocol basically provides a platform for new products to be launched on the Bitcoin Blockchain. As a result, every Omni transaction shares the same transaction hash as the Bitcoin transaction which produces it in the first place. There are other stablecoins launched on the Omni Protocol but Tether enjoys a massive share of 90% of Omni’s transactions (Blockgeeks, 2018).
Who is behind Tether
What team is working to make Tether successful?
Tether was initially founded by Brock Pierce, the director of the Bitcoin Foundation, with the technical assistance of the software engineer Craig Sellers and the entrepreneurial skills of Reeve Collins. Back then, in July 2014, the project was named Realcoin and its main objective was to develop a utility token that had a 1:1 parity with some real-world fiat currency (Jenkinson, 2018).
According to a recent development, it has been alleged in the leaked Paradise Papers, that Tether shares common management employees with the famous crypto-exchange, Bitfinex. Giancarlo Devasini is as of the time of this article, serving as a director for both companies, while Phil Potter is a director at Tether and holds the position of Chief Strategy Officer at Bitfinex. This allegation gave way to some serious suspicions regarding the transparency of Tether and the working and legitimacy of Bitfinex (John Ian Woong, 2017).
Tether has a number of notable industry partners, most of which ranges from trade exchanges to online banks. Industry supporters include Omni, Poloniex, Ambisafe, MegaChange, etc., while many trade exchanges like Bitfinex, Bittrex, HitBTC, etc. are listed as Tether’s partner. Recently, Bahamian Bank revealed its partnership with Tether Limited (Baker, 2018).
In another interesting development, Tron’s CEO, Justin Sun has announced his intention to adopt and introduce Tether token on the Tron network (De, 2019).