How does Tether stay on $1?

Many people wonder why the value of Tether (USDT) is always $1. This is because Tether has a strict policy of redeeming one tether for one US dollar, and they do this by holding enough cash reserves to cover all outstanding tethers.

Tether is a cryptocurrency that aims to maintain a stable currency and reduce volatility in the cryptocurrency market. The currency is backed by fiat currency and is pegged to the US dollar at a rate of 1:1.

Tether cryptocurrency uses the exchange symbol USDT to refer to the settlement system. One USDT can be redeemed for one US dollar through the Tether platform.

This ensures that the price stays close to $1.

The main use case of Tether is to allow traders to enter into positions without having to go through traditional exchanges. This means they can trade in cryptocurrencies without actually owning any cryptocurrencies themselves.

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