The following content is all my personal thoughts. If you have different opinions, please feel free to discuss them.

USDT value



The full name of USDT is Tehter USDT, which claims to be benchmarked against the US dollar, and 1 USDT is benchmarked against 1 US dollar.

The reason why USDT can become a stable currency is that Tehter Company claims that it will strictly prepare margins at a ratio of 1:1, that is, for every USDT token issued, its bank account will have a USD 1 fund guarantee. But later, as too many coins were issued, the company no longer announced the amount of margin, only the amount issued or destroyed.

Obviously, it is impossible for USDT to benchmark against the US dollar, but after various trading platforms began to use USDT as the calibrated currency, USDT really benchmarked against the US dollar.

Just like the Federal Reserve over-issuance of US dollars, but the US dollar has not depreciated in a short period of time, similarly, as long as everyone recognizes USDT and believes that this currency is benchmarked against the US dollar, then this currency will really be benchmarked against the US dollar.

Another reason why this coin is widely used is that major exchanges are unwilling to allow users to deposit money because of regulatory risks. When users deposit USDT against the U.S. dollar, the exchange is only responsible for buying and selling the currency and does not directly connect the money, which is equivalent to reducing its own risk. In particular, Chinese exchanges have a great need to reduce regulatory risks.

Although USDT is risky, everyone needs a mainstream stablecoin that is recognized by everyone as an intermediary for virtual currency transactions, so everyone will continue to use USDT before it collapses.

In addition to USDT, there are also a series of stable coins such as USDK, but too few people use them.





An interesting thing I discovered recently is that the rising and falling trends of mainstream virtual currencies are very similar, especially the short-term market trends.





My guess is that if the market is not doing well, and people sell BTC for USDT, it should not affect the market of other currencies. The key is that the currency-to-currency trading of exchanges is not limited to virtual currency for stable currency, but also includes virtual currency for virtual currency. For example, the price of Bitcoin against USDT fell, but the price of Bitcoin against Ethereum did not fall, so many people set up automatic transactions to exchange Bitcoin for Ethereum and then for USDT, which naturally led to the decline of Ethereum prices.

Similarly, when Bitcoin rises sharply, if you directly use USDT to buy Bitcoin, you will not make money. First, exchange USDT for Ethereum, and then exchange Ethereum for Bitcoin. In this way, you can make money from the price difference, which naturally drives up the prices of other currencies.