Stable Coins: The Best Tether (USDT) Alternatives
In a market that can turn volatile literally within seconds, nothing can be as helpful as a stablecoin. These are coins that generally don’t experience price volatility and are pegged to stable fiat currencies at the ration of 1:1.
The very nature of these cryptocurrency coins means investors can feel somehow cushioned when things suddenly turn south.
Other than coming to your aid as a store of value, stable coins actually are very helpful when you want to exchange one crypto for another. In some cases, you get to withdraw an equivalent of your money held in stablecoins.
They are, therefore, quite in demand on the market. There two main types of stablecoins: fiat-backed and those with underlying assets like gold etc.
The most popular, but also quite controversial Stablecoin is Tether (USDT). How does it compare to other coins in the same category? We will have a look at some of the hottest stable coins on the market at the moment.
Tether (USDT), as you probably already know, is a fiat-backed stable coin pegged on the USD. It is by far the most common, among the pioneer coins that have a large market share in the cryptocurrency landscape.
At the time of writing, USDT 24 hour trading volumes stood at $6.3B, more than any of the volume of its nearest challengers. It dominates the market, being listed on some of the major exchanges around the globe. Today, USDT had a market cap of $2.3 billion and ranked 15th on coinmarketcap.
TrueUSD is a relatively new coin in the market that is also pegged on the US dollar. Part of the motivation for launching it stemmed from the controversy surrounding USDT. It is said to be 100% collateralized by USD.
The team behind the coin has indicated that the coins’ are legally protected and that the coin is redeemable against the USD in a number of stores and ATMs.
Although at the moment used to provide stability in the market, there are plans underway to have the platform expand the coin’s fiat-backed reach to other currencies like Euro, Yen or commodities like gold and silver.
TUSD can be paired against BTC, ETH, and Tether and is predominantly traded on Bittrex exchange. TrueUSD has a market cap of $12 billion with a total and circulating supply of 12,013,115 TUSD. At the time of writing, $2,260,390 worth of TUSD had been traded.
Dai is a stable coin by MakerDAO. The cryptocurrency works more like the other two above and is valued against the USD on a 1:1 ratio. Even though MakerDAO (DAI) has its value pegged to the USD, it actually isn’t backed up by any real US dollar assets. It derives its value from the collateralized Ether.
The demand for Dai is created via smart contracts run on the Ethereum blockchain. The other fact is that this stablecoin is run by the MakerDAO community.
The coin’s parent holding recently entered into a partnership with Dether.io to work on having the stablecoin used on Mobile ATMs. The aim is to give the global community the chance to trade crypto and be able to switch between the coin and any supported cryptocurrency.
This will not only drive adoption but also make trading less risky for investors. At the time of writing, Dai had a market cap of $27.5 million and a 24-hour trading volume of $2, 345,256 worth of DAI had been traded.
bitCNY is one of the stablecoins that is backed up by the Chinese Yuan currency. It is marketed as a truly fungible and smart stable coin. The developers of this cryptocurrency say that the demand for its use relates to the community’s wish to have a coin that protects them from huge risks in the market.
It allows users to trade crypto and redeem value supported by real CNY to back up the circulating supply. It runs on the BitShares blockchain and isn’t mineable.
At the time of writing, the stablecoin had a market cap of $40.01 million with a circulating and total supply of 2229, 709,000BITCNY. The crypto had a trading volume of $22,201,100 worth of the bitCNY.
Stable coins provide investors with an option of purchasing crypto easily but also at reduced volatility. With a stablecoin, you can exchange crypto when volatility hits the market, helping you to store value, as you ride out the storm.
Even though USDT remains the biggest by market cap, rising coins like TUSD, bitUSD, Digix Gold, and Dai could pose a challenge, especially if the controversy doesn’t go away.