There are market cycles when prices skyrocket and drop. Successful investors learn those trends and investigate crypto charts to understand the next fluctuation of the market and take advantage of it. It concerns most crypto assets such as Bitcoin, Ethereum, etc.
However, if you look at the crypto ranking, you will see some coins whose prices do not change and are usually about one dollar (Tether USDT, USD Coin USDC, etc.). These are stablecoins.
It becomes clear from the name that those assets are stable and not volatile. They are pegged to some stable fiat currency (usually the dollar). Stablecoin is not a cryptocurrency to invest in, for its rate will not grow, so there is no space for price speculations.
What Is the Point Of Using Stablecoins?
One of the most traded pairs with stablecoins on cryptocurrency exchanges is BTC USDT. It actually shows the current rate of Bitcoin against the dollar. Tether (USDT) is the leading stablecoin in the market. Here are some use cases for Tether:
- Since the crypto market is subject to volatility, sometimes very rapid and rushed, USDT serves as a safe harbour for investors to hedge risks. By converting crypto assets into USDT, traders don’t have to leave the market but still preserve the fiat value of their investments on a cryptocurrency exchange.
- USDT is often used for business settlements, for USDT is equal to the dollar. Crypto transactions to any point in the world are much faster and less costly, so many business people prefer to transfer money in the form of stablecoins instead of using banks. For that purpose, a sender and recipient just must have crypto wallets.
Tether is listed on all popular crypto platforms, such as Binance, Kucoin, WhiteBIT, etc. These are legitime platforms that allow buying crypto assets using bank cards. Only registered and verified users access this option.