What is USDT? (Digital Dollar) and how to buy it

The world of crypto has become very popular. But this world is very volatile and the prices of cryptocurrencies are constantly rising and falling.
Therefore, this makes dealing with cryptocurrencies difficult and unrealistic. For this reason, stablecoins emerged to facilitate transactions in the world of cryptocurrencies.
Let’s learn more about the most famous stablecoin, which is the famous USDT.

What is USDT currency?

USDT is a cryptocurrency that lives on several different blockchain networks. This currency is priced at the price of the US dollar.
Therefore 1 USDT always equals 1 USD at all times. It is a type of stablecoin but linked to a fiat currency.

This currency is considered one of the centralized stable currencies. This is because the issuer of USDT, Tether, is the main controller of the global currency stock.
It is also responsible for maintaining the price pairing between USDT and the US dollar.

Tether has bonds and deposits in banks in dollars equal to the size of the coin’s market capitalization.
Therefore, whenever new USDT currencies are produced, deposits in banks are increased to act as a monetary cover that keeps the price at 1 USDT per 1 dollar.
Whenever customers withdraw their dollars, USDT coins are burned so that their price does not rise.

What is the difference between USDT and Bitcoin?

There is a big difference between USDT and currencies like Bitcoin and Ethereum.
The purpose of USDT is to provide a stable, all-time alternative for easily conducting transactions on the blockchain.

For example, the price of Bitcoin last year in October was about $21,000. Currently, its price is approximately 27 thousand dollars.
This large difference in price makes many people not prefer to use cryptocurrencies due to high volatility.
Last year, the price of Bitcoin fell to $15,000 and reached approximately $32,000. Therefore, this shows the difficulty of dealing with it.

But the price of USDT last year was $1 and this year it is also $1. Therefore, this makes it very easy to deal with this currency on the blockchain.

The importance of USDT now

The greatest importance currently of the USDT currency is its use as an alternative to the dollar for international transfers.
This currency can be paid from a person living in America to a person living in Australia within just a few seconds.
This is in contrast to the traditional dollar, which can arrive after three business days.

For this reason, the pressure on stablecoins, especially USDT, has increased significantly since it is the giant of stablecoins recently.
Demand has increased dramatically in countries that suffer from local currency instability, such as Turkey, Lebanon, and Venezuela.
The currency in these countries is very popular due to the failure of central banks to control inflation and the weakness of the local currency.

Is it possible to invest in USDT currency?

The answer to this question boils down to your situation and where you live.

If you live, for example, in a country like Türkiye, then yes, you can invest in the USDT currency.
This is due to the continuous floating of the Turkish lira, its loss of purchasing power, and the complete collapse of the local currency.
Therefore, many Turks resort to saving their savings on the blockchain in the form of USDT currencies.
We used this specific example because the Turkish government welcomes cryptocurrencies and does not seek to ban them in the country, unlike a country like Egypt.
If you do this in Egypt, this is considered against the law, so you must be careful and do not do this in Egypt.

If you live in the United States or Europe, the answer will be no. This currency would not be worth equal to the dollar.
Therefore, if you keep your savings in the form of USDT, this may make it easier for you to transfer money outside the country, but it will not be considered an investment.
The currency is affected by US inflation levels, just like the dollar. That is why it is necessary to understand its purpose and importance.

USDT use cases

USDT can be used to pay the salaries of employees, especially those living in other countries and continents.

The currency can also be used to transfer money abroad in an easy way. It can be used for cryptocurrency trading and speculation.
Finally, it is also used on decentralized platforms to trade and interact with various decentralized applications.

Buy USDT
USDT

Risks that you should hedge against

USDT is not a risk-free coin. In the world of cryptocurrencies, there is not a single risk-free investment asset.

The currency is risky. A crisis may occur for Tether and it will be unable to stabilize the pairing price in dollars.
This has happened several times over the past years. The price of the currency fell more than once to about 90 cents against the dollar, but it soon regained its peg with the dollar again.

We saw what happened to the UST stablecoin in 2022 when it lost its pairing with the dollar and fell to zero.
This crisis was repeated with the largest competitor to the USDT currency, the USDC currency of the American company Circle, in March 2023, but the currency also quickly regained its pairing with the dollar.

A crisis occurs when there is a disruption in the monetary cover covering the currency.
If there are 80 billion USDT, the monetary cover must be equal to 80 billion dollars. If it is less than this, panic will spread among the investors, and the currency will fail.

Therefore, you must know well that the currency is vulnerable to this happening at any time, so be always aware of the risks associated with stable currencies.

How can I buy Tether currency?

After knowing all this, it’s time for the important question: can USDT be bought easily?

Yes! This currency is considered one of the easiest currencies ever to buy in the crypto world.
This is due to its abundant liquidity and always high demand. Hence it is very easy to buy them from different channels.

The most popular channel for purchasing this currency is through a bank card in countries whose banks allow dealing with cryptocurrencies.
This is usually done through central platforms that you access and create an account. After that, you perform KYC procedures, then link your bank card to the platform and buy the currency.
Fees range from approximately 2 to 4% and sometimes exceed this.

Buy USDT on OKX
Buy USDT

You can also buy USDT on decentralized platforms or direct hot wallets like MetaMask or TrustWallet.

Finally, you can buy the currency through the free peer-to-peer market.
This is the most common method in the Arab world to obtain USDT currency, but make sure that this method is legal or at least not prohibited in your country before using it.

Here you can easily send money via an electronic wallet or bank transfer to someone else and you will receive USDT instantly on the central platform, which in most cases is the Binance platform.

Where can you keep Tether?

Unlike banks, you do not have to keep this currency in a bank account. You can choose where you want to keep the currency.

If you want you can leave it on a central platform but you should beware of the risks of this.
If the platform is hacked, you may lose all your currencies on the platform. Therefore, we always advise only leaving the currencies that you want to trade soon on the platform and withdraw the rest.

You can withdraw your coins either to an online hot wallet such as MetaMask or to an offline cold wallet. This wallet is considered like a flash drive and is the most secure wallet.

This means that if you want to keep USDT currencies for a long period, such as a year, it is better to keep these currencies in a cold wallet.
When using hot wallets, you must always beware of security breaches and websites that can steal all the money in your wallet.

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