What is USDT
USDT is a cryptocurrency that lives on more than one different blockchain network such as Ethereum, Solana, and others. The price of this currency is linked to the price of the US dollar. Therefore, 1 USDT is always equal to 1 US dollar at all times. It is a type of stablecoin but linked to a fiat currency.
This currency is considered a centralized stablecoin. This is because its issuing entity, Tether, is the main controller of the global currency supply. It is also responsible for maintaining the price coupling between USDT and the US dollar.
The company has bonds and deposits in banks in dollars equal to the size of the market value of the currency. Therefore, whenever new USDT coins are produced, deposits in banks are increased to act as a cash cover that maintains the price coupling at 1 USDT per 1 dollar. And whenever customers withdraw their dollars, USDT coins are burned so that their price does not rise.