USDT (Tether) is one of the well-known stable coins in today’s cryptocurrency market. It is ultimately beneficial comparing to other regular cryptocurrencies. Since it ties on a 1:1 ratio to the US dollar, it gives you an absolute stability factor when investing crypto, and you would not risk losing value to volatility. Yet, make sure you find a trustworthy and reliable platform for USDT trading.
Here are five main benefits of why you should buy USDT as your first crypto.
5 benefits of buying USDT as your first cryptocurrency
An alternative to fiat currency
According to Investopedia, Tether was specifically designed for a necessary bridge between fiat currencies and cryptocurrencies. Since USDT is pegged on a 1:1 ratio to the US dollar, USDT shares an equivalent value as the US dollar even when there are big moves in the market. Investors are holding weak fiat currencies can also trade them into USDT to avoid depreciation and enjoy the advantages of the US dollar in terms of value.
You can see it as an alternative to fiat currency, using it to store value or avoid depreciation in some fiat currencies.
Stability in value
Trading regular cryptocurrencies to others always involves a collection of uncertainty and extra investment risk, but USDT makes it a different case. For example, if you are holding BTC and then trade it to ETH. When the prices of ETH rise by 5%, you would like to trade it out for BTC to earn the rise. But unfortunately, before your transaction finishes executing, the prices of BTC drop by 10%.
In this particular context, you will turn out losing money during the whole crypto-to-crypto transaction. However, if you are holding USDT instead of BTC in this case, the price of USDT is stable, so your only concern is just the price change of the other crypto.
Lower inherent volatility
Unlike other cryptocurrencies, like Bitcoin, USDT holders do not have to be extremely careful when investing in the crypto market because it is less volatile. Again, USDT, as a stable coin, has its own pegged value. It costs little impact or even no impact on the value, although something big happens in the market. Comparing to the other cryptocurrencies, which have inherent volatility might often experience ups and downs in price. That being said, it is comparatively less risky of putting money in USDT.
Tether increases transparency
In the crypto world, the tradings of cryptocurrencies are usually under a degree of unclarity. Some cryptocurrencies say Bitcoin, like your purchases and other transactions, can all be anonymous. Meanwhile, USDT holders do not bother with the transparency issue as the US dollar is behind it. And, the Tether limited shares the detail of all coins in transactions publicly.
A quality choice to enter the crypto world
USDT is definitely a quality choice for new investors to explore the crypto world. You may want to start with something safer, stabler, and more transparent. The tied relationship between USDT and the US dollar is the best advantage to invest under a stability factor, where you never go into a vital loss when you buy USDT!