What is USDT? Tether and stablecoins explained
USDT, also called Tether, is the most traded cryptocurrency in the world. Unlike Bitcoin, its price is designed to stay close to one US dollar. Coins that do this are called stablecoins.
How a stablecoin keeps its price
The company behind USDT says each token is backed by reserves such as cash and short-term US government bonds. People who hold USDT expect to be able to swap it for one dollar, and traders keep its market price close to that by buying below a dollar and selling above it.
Why traders use USDT
- A safe harbour: move out of a volatile coin without leaving crypto.
- A common price unit: most pairs are quoted in USDT, such as BTC/USDT.
- Fast transfers on many blockchains, any time of day.
- Dollar savings for people whose local currency is losing value.
The risks
A stablecoin is only as strong as its reserves and the company behind it. Stablecoins have briefly lost their peg in the past. USDT also exists on several networks (for example TRC20 and ERC20); always send on the same network the receiving wallet expects.
Buying USDT on Velxen
The simplest way is P2P with a bank transfer. Escrow locks the seller's USDT before you pay, so you are protected from start to finish.
This article is for education only and is not financial advice. Crypto prices can rise and fall sharply; only trade with money you can afford to lose.
