The Controversial Rise of Tether: Examining the Pros and Cons of the Stablecoin Phenomenon
Tether is a cryptocurrency that is designed to be stable and pegged to a specific fiat currency. It is issued by Tether Limited, a company based in Hong Kong, and is often referred to as a «stablecoin.»
Tether is issued on various blockchain platforms, including the Bitcoin and Ethereum networks. Each Tether token represents a corresponding unit of the fiat currency that it is pegged to. For example, one Tether token may be worth one US dollar. This means that the value of Tether is intended to remain stable, unlike other cryptocurrencies which can fluctuate significantly in value.
Tether is often used as a way to store value or transfer funds between exchanges, as it allows users to avoid the volatility of other cryptocurrencies. It is also used as a way to facilitate transactions between exchanges that do not accept the same fiat currencies.
However, Tether has faced controversy and criticism in the past. There have been questions about the company’s transparency and its ability to back each Tether token with a corresponding unit of fiat currency. In April 2019, the New York Attorney General’s office launched an investigation into Tether and the cryptocurrency exchange Bitfinex, alleging that the two companies had covered up the loss of hundreds of millions of dollars. The investigation is ongoing.
Overall, Tether is a unique cryptocurrency that has gained widespread adoption due to its stability and utility. While it has faced controversy, it remains an important player in the cryptocurrency market.