Tether (USDT) is a cryptocurrency known as a stable-value cryptocurrency, created with the aim of maintaining stable valuations of other cryptocurrencies, in contrast to the significant price fluctuations observed in other popular cryptocurrencies like Bitcoin or Ethereum. It is used as a means of exchange and a way to store value, rather than being used as a means for investment or speculation.
Tether was designed to be the necessary bridge between traditional currencies like the Euro and the US Dollar and cryptocurrencies like Bitcoin and Ethereum, providing stability, transparency, and minimal transaction fees for users. Tether is pegged to the US Dollar (USD) and maintains a 1:1 ratio with the US Dollar in terms of value. However, there is no guarantee provided by Tether as a company for any right to redeem or exchange Tether cryptocurrency for any real currency - meaning that Tether digital currencies cannot be exchanged for US Dollars.
It is worth noting that according to a recent study on cryptocurrency trading, it was observed that trading Bitcoin (BTC) with Tether (USDT) still represents the majority of BTC traded, whether against traditional fiat currencies or stablecoins. In February 2021, 57% of all Bitcoin trades were conducted in USDT. Tether remains a major source of liquidity in the cryptocurrency market.