The very existence of Tether explains why a comprehensive background search is needed before investing in any cryptocurrency. It is unfortunate that people have probably invested in this asset, but it is not too late to get back their funds.
Cryptocurrencies exist for a purpose, and not all of them were created to be an investable asset. Any asset which is worth investing in must have the ability to rise in value above its buying price to make some profits to the investors. Tether, however, does not work like that. Its value has firmly been pegged to the US dollar that it cannot extremely rise or fall against it.
In August 2015, the value of Tether was $1. In September, October, November, and December of 2015, Tether had the same constant or horizontal line on its price curve. It further maintained its $1 price until 12th August 2016, when it dropped by few decimals to trade at $0.96 before getting back to its usual $1 dollar zone.
Its stability as a cryptocurrency is very surprising. Some exchange platforms use it as the USDT. Considering how stable its price is, it can perfectly be a store of value. It can be used to store an asset and shield it from market pullbacks.
It is very important to note that Tether was designed to be backed 1-to-1 by traditional currencies. The team behind it ensured that it will always be equivalent to the US dollar. Due to this, it is usually used to buy other digital currencies on the various exchange platforms.
It is also one of the preferred ways of depositing and withdrawing on the platforms. By design, anyone who invests on Tether will make no lose and will make no gain either. It perfectly solves the volatility problem of cryptocurrency.
Tether claims that the token is not a financial instrument. According to them, owners of the cryptocurrency has no guarantee or contractual right against loses.
The revelation of Tether leaves a great lesson to investors and anybody who intends to enter into cryptocurrency investment. A search into the price history of the cryptocurrency should be a must, and its purpose or what they seek to achieve should not be overlooked.
There are many cryptocurrencies that have been invented, and more are in the pipeline, however, it is worth noting that many of them are not investable assets.