Tether, the first stablecoin, is issued by the company Tether Limited, which claims that each token is backed by one US dollar. Launched in 2014 by the entrepreneur Reeve Collins, the Bitcoin investor Brock Pierce and the developer Craig Stellers, it is the most significant stablecoin by market capitalisation. Originally issued on Omni Layer, Tether tokens are now available on a number of different blockchains, and users can swap between dollars and the Tether cryptocurrency, which keeps the stablecoin pegged to the dollar. Tether Limited is controlled by the owners of the cryptocurrency exchange Bitfinex, which was accused by the New York Attorney General of hiding a loss of $850 million in cryptocurrencies since mid-2018, by using the resources of this company to cover the losses.
It’s the universe of digital currencies, from the first entrant, Bitcoin, to Litecoin, Ethereum and Ripple, which rely on blockchain technology to secure transactions and keep third parties from creating new units. Most notably, the sector had no central institutions; depended on blockchains to prevent either unregulated creation of new units or changes to prior transactions; and (in theory at least) did not use intermediaries. All this led to accusations that the sector was unreliable, volatile, ripe for fraud or illegal activities.
A cryptocurrency is stored in a digital wallet, a piece of software that holds the cryptographic keys that indicate ownership of a cryptocurrency. You buy cryptocurrencies on specialised exchanges, and their price depends on supply and demand, and on the capricious commitments of the miners – so it’s potentially more volatile than real money and, hey presto, you’re at risk of losing everything at a moment’s notice. Investors in digital assets should be aware of the high risks involved, including the risk of losing all their money in an instant.
Source: infobae
