Tether

Introduced in 2014, Tether is a platform built on blockchain technology that aims to enable the digital usage of fiat money. The project seeks to challenge the traditional financial system by offering a contemporary method for handling currency. Tether has achieved progress by allowing users to conduct transactions with standard currencies on the blockchain, thereby avoiding the usual complexity and price swings linked to digital assets. As the initial blockchain-based solution to support the digital application of conventional currencies (which serve as a stable and recognizable unit of account), Tether has made cross-border blockchain transactions more accessible.

USD₮ is a blockchain-based stablecoin that functions as a digital dollar, maintaining a 1:1 peg to the USD. It offers people and entities a decentralized and reliable way to transfer value using a standard accounting unit.

Tether USDt (USDT) operates as a digital token deployed across multiple major blockchains, such as Algorand, Avalanche, Bitcoin Cash’s Simple Ledger Protocol (SLP), Ethereum, EOS, Liquid Network, Omni, Polygon, Tezos, Tron, Solana, Kava and Statemine. These underlying transport protocols utilize open source software to interact with the respective blockchains, facilitating the issuance and redemption of Tether tokens. Each token is fully backed 100% by Tether's reserves. Maintaining transparency, the company releases records detailing its current reserve assets.

Tether USDt (USDT), originally called Realcoin, was introduced in 2014 by Brock Pierce, Reeve Collins, and Craig Sellars.

Brock Pierce is a prominent entrepreneur who has co-founded various notable ventures in the entertainment and crypto sectors. In 2013, he helped establish the venture capital firm Blockchain Capital, which secured more than $80 million in funding by 2017. The following year, Pierce took on the role of director at the Bitcoin Foundation, a nonprofit organization dedicated to promoting and enhancing Bitcoin. He also co-founded Block.one, the entity responsible for EOS, which ranks among the largest cryptocurrencies available.

Reeve Collins served as Tether’s CEO during its initial two years. Before this role, he co-founded multiple successful businesses, including the online advertising network Traffic Marketplace, the entertainment studio RedLever, and the gambling site Pala Interactive. As of 2020, Collins leads SmarMedia Technologies, a firm specializing in marketing and advertising technology.

In addition to his work on Tether, Craig Sellars has been associated with the Omni Foundation for more than six years. The foundation’s Omni Protocol enables users to trade and create smart-contract-based currencies and properties on the Bitcoin blockchain. Sellars has also held positions at several other crypto-related organizations and companies, such as Bitfinex, Factom, Synereo, and the MaidSafe Foundation.

Tether distinguishes USDT by guaranteeing its value stays pegged to the U.S. dollar. The company states that for every new USDT token issued, an equivalent amount of USD is placed into reserves, ensuring the asset is fully backed by cash and cash equivalents.

While typical cryptocurrencies can swing 10-20% in a single day due to market volatility, making them poor stores of value, USDT is shielded from such price changes. This stability allows investors to use Tether as a safe haven during turbulent times, letting them hold their portfolio value without converting entirely to fiat USD. Furthermore, USDT enables straightforward cross-border transactions—spanning regions, countries, and continents—via blockchain, bypassing slow and costly intermediaries like banks or financial service providers.

Nevertheless, controversies have arisen over the years concerning the validity of Tether’s reserve claims, occasionally impacting USDT’s price, which dropped to a low of $0.88 at one point. Critics frequently cite the lack of a full audit by an independent third party as a major concern.

In July 2022, Tether joined forces with Bitfinex and Hypercore, a peer-to-peer data network, to launch Keet, a social media application. This fully encrypted video chat tool is currently available only on desktop, though the team plans to bring it to mobile devices in the near future. Keet holds the distinction of being the first application built on Holepunch, a platform designed for creating Web3 apps. While the project remains closed-source at present, the involved companies aim to release the code as open-source by the end of the year. When asked about the motivation behind entering the chat app space, Ardoino, who also serves as chief strategy officer at Holepunch, cited “freedom of speech” as the primary reason.

USDT does not have a fixed maximum supply cap. Since it is issued by a private entity, the theoretical limit depends solely on Tether’s internal policies. However, because the company asserts that each USDT is backed by one U.S. dollar, the actual number of tokens in existence is constrained by its cash reserves.

Tether does not publish future issuance plans. Instead, it releases daily transparency reports that detail its asset reserves and liabilities, with the liabilities reflecting the current circulating supply of USDT.

According to Tether, as of September 2020, more than 14.4 billion USDT were in circulation, supported by $14.6 billion in assets.

Tether USDt (USDT) lacks an independent blockchain. Rather, it functions as a second-layer token built upon the blockchains of other cryptocurrencies, specifically Bitcoin, Ethereum, EOS, Tron, Algorand, Bitcoin Cash and OMG. Security is provided by the hashing algorithms associated with each of these underlying networks.

You can purchase Tether (USDT) on numerous cryptocurrency exchanges. Its average daily trading volume frequently matches or surpasses that of Bitcoin. This stablecoin is particularly significant on platforms lacking fiat-to-crypto pairs, serving as a practical substitute for the USD. Below are some widely used exchanges that facilitate Tether trading:

In May 2022, Tether revealed the introduction of MXNT, a stablecoin supported by the Mexican peso. This initiative signaled its entry into the Latin American market, coming after the prior releases of its USDT, EURT, and CNHT stablecoins, which are tied to the U.S. dollar, euro, and Chinese yuan, respectively.

At launch, MXNT will be accessible on three primary blockchains: Ethereum, Polygon, and Tron.

Paolo Ardoino, the firm’s CTO, stated that rising cryptocurrency adoption in the region drove the decision to expand into Latin America. Significantly, a report from crypto payments provider Triple A showed that 40% of Mexican companies were keen on adopting cryptocurrencies in some capacity, with 71% within the sector specifically centered on cryptocurrency usage.

Tether identified Mexico as a “prime location” for the next Latin American crypto hub. The strategy aims to bring as many new users as possible into the Latin American market, utilizing the MXNT launch as a pilot for future fiat-pegged currencies in the area.