Tether USDt
Crypto Overview
Understanding Tether (USDT)
Tether (USDT) is a stablecoin cryptocurrency designed to maintain a 1:1 peg with the US Dollar. Created in 2014, it serves as a digital dollar equivalent on various blockchain networks, primarily facilitating crypto-to-fiat conversions and providing a stable medium of exchange. The intended utility is to offer traders and users a way to hold dollar value in digital form without leaving the cryptocurrency ecosystem.
Business Model & Actual Usage
Tether Limited, the company behind USDT, maintains reserves to back each token with equivalent assets. According to their latest attestation reports, these reserves consist of cash, cash equivalents, short-term deposits, commercial paper, and other assets. The actual usage aligns closely with its intended purpose, serving as the dominant stablecoin in the crypto ecosystem with significant daily trading volume across major exchanges.
Real World Adoption
USDT is the most widely used stablecoin in the cryptocurrency market, with a market capitalization exceeding $83 billion as of 2024. It is integrated into most major cryptocurrency exchanges and supports multiple blockchain networks including Ethereum, Tron, and Solana. The token demonstrates consistent high daily trading volumes, often exceeding several billion dollars.
Platform Development & Transparency
Tether has improved its transparency over time, publishing quarterly attestation reports of its reserves. However, they have faced scrutiny regarding the exact composition of their reserves and previous claims about full dollar backing. They have settled with the New York Attorney General's office in 2021 and have since worked to increase transparency in their operations.
Token Distribution & Founder Assessment
Unlike typical cryptocurrencies, USDT's supply is managed by Tether Limited based on market demand and their ability to maintain dollar reserves. The token distribution model differs from traditional cryptocurrencies as new tokens are minted when dollars are deposited and burned when redeemed, maintaining the 1:1 peg.
Crypto Impact
To assign a comfort level investing in Tether USDt from a halal perspective we need to determine whether it has a net positive or negative impact.
Towards this end, the table below is used to tally all the positive and negative considerations our members can think of related to Tether USDt.
If you don’t see something that should be listed, positive or negative, feel free to submit your own contribution using the button “Contribute”.
We will review your contribution for accuracy before publication.
Importantly, you can review listed contributions and vote on which one you think has the greatest impact, positive or negative.
You only have one vote per asset so use it wisely.
You can change your vote if you change your mind.