Steem cryptoacademy:- home work post for @yohan2on week 6

Hey there, this is @prakhar9675 this side. And this Post is against the home work given by @yohan2on professor.

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Write about any one of the following stable coins;

Tether(USDT)
Steem backed dollar(SBD)
DAI

So in this post, I will discuss about one of the most popular stable coin Tether (USDT)

What is stable coin

Stable coin are those which are digital in nature (that is these are cryptocurrency) but it's price is very stable and doesn't fluctuate much in a very short period of time.

For example most of the cryptocurrency are highly unstable and it's price are highly unpredictable.

For example the price chart of ethereum is given below

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This is the chart of price of ethereum in INR and BTC. So you can see the price of highly unstable.

similar case is with bitcoin. And it's price is very unstable and it has increased and decreased by many percentage in a single day.
For example when Tesla announced that it's going to invest trillions of USD in bitcoin, it's price increased rapidly

And recently we saw the similar case with Doge coin which was not that popular. And when Elon Musk tweeted about it, it's price increased rapidly.

But on the other hand, if we saw the chart of stable coin, it's price remains nearly constant.

For example, I am referring price chart of stable coins.

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This chart may be looking unstable, but when you the price written on the vertical axis, then you can see this coin has not fluctuated much.

So this is a stable coin.

Types of stable coins

Mainly there are four types of stable coin.

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The most commonly and most popular type of a stable coin is fiat backed coin
As the name suggests, these coins are backed by a fiat currency like Euro, USD or any other fiat currency

This means these coins has ration 1:1 with the price of a fiat currency.
Example of this types of coin is USDT.
This is fifth most popular coin listed on coin market cap

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Similarly commodity backed and cryptocurrency backed coins depends on the commodity like gold and cryptocurrency respectively.

why we needed stable coins

As we discussed earlier that the biggest problem with the cryptocurrency is that it's price is highly unstable and a class of people fears with this instability. And they hesitated to invest in cryptocurrency.
So to make cryptocurrency among that class of people and to make that class included in cryptocurrency too, stable coins were founded.

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These coins encourage those people to invest in cryptocurrency and make cryptocurrency more popular among more people.

Tether or USDT

Tether which is commonly termed as USDT is a fiat based cryptocurrency. This was founded in 2014. This is backed by fiat currency USD. 1 tether approximately = 1 USD mostly.
This is one of the most popular coin and listed as 5th most popular coin on coin cap market.

The two of the reasons behind this popularity are stability and secondly that one can easily exchange many coins directly with USDT. There are many options available for this.

This is some of the available coins in pair with USDT.

Tether as a stable coin

Tether is a stable coin and by seeing many rate charts, graphs and all time high/low and 24 hours high/low, you can easily conclude the same.

USDT and USD:-

As we have discussed that USDT is backed by USD and it's price remains roughly equal to USD.
You can conclude the same by the price chart given below.

Price chart of USDT

This price chart says that the fluctuation is not very high and it's stable coin

24 hours low/high of USDT

So you can see the 24 hours low and high of USDT is 72.53 and 72.76 INR respectively.

So now we all can conclude that USDT is a very stable coin and one can invest here without fear of fluctuation in price.

Pros of USDT

•The biggest benefit of this coin is its stability. It's price remains close to USD. And this property of the coin has encouraged many people to invest their Savings in cryptocurrency.

•• with USDT you can easily exchange a number of coins. This makes this more popular coin.

Cons of USDT

The one of the cons of this coin is its security. Reportedly, in 2017 USDT worth of 31 million dollars were stolen. And then a controversy was created which is continuing till now.

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So that's all guys From my side.

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All graph and charts are taken from coin market cap website.
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Cc
@yohan2on
@steemcurator01
@steemcurator02