Tether, Bitfinex, Ethfinex – basically sister projects by one group – are going to offer tokenized USD dollars on the Ethereum network. This will facilitate better trading of Ethereum-based cryptocurrencies in USD pairs, assuming that the Ethereum Tether token will be tied to the US Dollars.
USD Tether tokens were created to allow trading USD/Crypto pairs without cashing out to actual US dollars. USDT are supposedly backed by US dollars though there are concerns they are not. Ironically the USDT creators prefer to spread their reach to Ethereum rather than increase trust for the existing token.
Here’s what they say about themselves:
By introducing fiat tokens — digital cash — to the Bitcoin & Ethereum blockchains, Tether makes a significant contribution to a more connected ecosystem by adding digital currency benefits, such as instant global transactions, to traditional currency and traditional currency benefits, in the form of price stability, to digital currency.
Others are less enthusiastic:
The point is, usdt is fake.
— BitCrypto’ed🔥 (@Bitfinexed) September 16, 2017
All in all a USD substitute token is a convenient instrument for traders, but it has to be fully transparent, not to mention actually backed by USD. Subscribe to follow this story: