In the second half of 2065438+2008, stable coins attracted great attention, and various stable coins appeared one after another. This article shares the advantages and disadvantages of USDT with you, hoping to help you.
What is USDT?
Tether USD (USDT for short), Chinese name TEDA coin. Tether Company, which issued USDT, was originally named Realcoin, and its registered places were Isle of Man and Hong Kong. 20 14, Realcoin Company changed its name to tether. In 20 15, Tether released by Tether Company went online on bitfinex and Poloniex trading platforms, and then went online on more large trading platforms. Bitfinex is currently the largest virtual money market exchange in the world.
Characteristics of USDT
1, Tether's website claims that it will strictly abide by the reserve guarantee of 1: 1, that is, every time a token of 1 USD is issued, its bank account will be guaranteed by 1 USD. Users can query funds on the tether platform to ensure transparency.
But the reality is that it is difficult for ordinary users to inquire and will not follow the promised behavior. It is only because of its important market position that it has formed operating habits.
2.Omni agreement is used for issuance and trading.
The issuance and transaction of USDT use Omni (Original Mastercoin) protocol. Omni coin can be said to be the first 2.0 currency based on bitcoin blockchain in the market, so the transaction confirmation parameters of USDT are consistent with bitcoin.
Essence: That is to say, USDT is essentially a virtual currency, USDT≠ USD. Just now, in the currency circle, there was a misunderstanding that USDT was equal to USD.
3. Store in a small country.
Tether, the controversial issuer of stable currency, left his assets in Puerto Rico.
This is very clear, avoiding supervision. Dude, do whatever you want.
4.USDT is supervised by the company.
What are the main advantages of USDT?
1, avoiding the overall downside risk of the currency circle.
At present, there are risks of ups and downs in the market, whether it is Bitcoin or the platform currency of Ethereum. On the other hand, the ratio of USDT is basically stable at 6.6. That is, 1USDT=6.6 yuan RMB. When the market currency price fluctuates violently, the USDT still rises slightly, and will rise to 1USDT=7.2 RMB. However, the overall level remains around 1 USDT = 6.6 yuan.
2. Withdraw cash from digital currency.
As we all know, after 1994, virtual currency trading, cash withdrawal and recharge are prohibited in China. However, all the noise is for profit, and many speculators have gone out to sea to trade coins. After currency transaction, it can be converted into US dollars through USDT. On many trading platforms, you can convert USDT into USD by selecting USDT/ USD trading pair. The problem of cash withdrawal and recharge has been solved.
3.USDT has a wide range of cooperation platforms.
Now in the virtual currency market, all well-known exchanges have opened the transaction matching function of USDT. It is no exaggeration to say that USDT monopolized the market.
4. Market transactions account for an important proportion.
At the beginning of 20 18, Tether accounted for about 10% of bitcoin transactions, but in the summer of 20 18, it accounted for 80% of bitcoin transactions. On the trading platform, USDT/XXX currency pairs are opened for mainstream currencies and currencies with large trading volume, which is convenient for investors to trade.
Main risks of USDT
1, issued by the company, without legal guarantee.
USDT is issued by Tether Company and has its own centralized nature. Although bitfinex is the largest virtual money market exchange in the world, it is also facing the risk of bankruptcy. There is no commitment to guarantee payment, and there is no disclosure of reserves and payments. At the same time, USDT has a poor reputation, and bitfinex has always been said to manipulate the market. Recently, the ETF in the United States failed, because there is a great risk that regular bitcoin will be manipulated by the market.
2.Overhair is common.
From the publication of 20 15 to 2018/916, the USDT has been issued nearly 100 times. From 20 17 10 to September 20 18, the number of series products increased from about100000 USD to about 2.8 billion USD.
Due to theft, security can't be guaranteed.
2017/11/21,USDT was stolen more than 30 million dollars, and the exchange suspended the recharge of USDT one after another. No one jumped out to take charge of the stolen assets afterwards.
abstract
First of all, the biggest advantage of USDT is that it can ensure that investors' assets in the currency circle will not shrink with the ups and downs of the market. The biggest risk of USDT is that Tether's distribution is completely centralized, that is, the distribution, acceptance, regulatory risk and operational risk are all concentrated in Tether company.
Secondly, USDT plays the role of leek harvester in the currency circle, and B-Net uses USDT, that is, judges, athletes and spectators, to collect virtual coins and dollars in the market, and B-Net itself has developed into the first digital currency platform in the world. Several small bull markets in the money market are also related to the pull of B network.
In addition, the instability of USDT has become the biggest powder keg in the currency circle, and it will explode at some point. Although it is not easy to have an accident in reality, there are accidents at any time in theory. The market share of USDT is too high, and any negative interest rate may lead to a major earthquake in the currency circle.