Introduction

It's a great pleasure on my part to be a part of the week 6 lecture delivered in the crypto academy community by my very own respected professor @yohan2on. He talked about stable coins and I have read and understood all he has discussed and it's on that very note that I will be carrying out the homework, given by him.

What Are Stable coins

First and foremost, what do we understand by the word stable coins? Stable coins as the name imply "STABLE", it is a cryptocurrency coin that has its price pegged to gold or silver, u.s dollars etc with the main purpose of price stability. It's no longer a story that cryptocurrencies are highly unstable. But despite all this instability, there are still some coins we call stable coins. The instability of cryptocurrency can not be over emphasizes as fluctuations of prices in coins happen within minutes. We have examples of stable coins as listed below.

• USDT
• USDC
• DAI
• BUSD etc.

Today, I will be looking at one of the stable coins, so please feel free to learn from me and also contribute to you quarterly.

Tether (USDT)

Source

Why USDT? One will be tempted to ask why did I choose USDT? The reason is simple, USDT among all the stable coins I listed above is the only stable coin I have traded on. Research has shown that USDT actually came into existence in 2014 and since it's an invention, it has always maintained standard. It's is important to mention here that the USDT value is most often equivalent to $1. Though, even as stable as the coin is, it sometimes rises or falls. Most people prefer trading on the stable coin because the degree of loss is very minimal. More also, traders of these coins take the slightest opportunity to either buy or sell the said coins.

Features of USDT

There are a whole lot of features I.e something special about USDT but for this homework, I will be discussing the following.

• Can be used to buy another cryptocurrency
• its value is same with dollars I.e (1USDT = $1)
• it helps to check the instability of coins
• Market access is easy with USDT as it is generally accepted.

Limitation of USDT

Just like other stable coins, USDT has also a few limitations among which includes

• Stable coins are centralized in nature I.e traders have no option than to trust the exchange to back their Fiat.
• Economic failure can crash fait in USDT.
• Stable coins are less liquid.

Use of USDT

• use for the daily transaction of buying and selling
• Helps to check currency instability
• can be used to swap between currencies in any exchange platform.

Conclusion

From all I have learnt within these week 6 crypto academy and from the lecture delivered by our very own professor in the person of @yohan2on, also with the little research, I have made, I have discovered and also concluded that the very reason stable coins was invented into the crypto world is to check the instability of coins. And it has played a significant role in the crypto world.

Special regards;
Cc: @steemcurator01
Cc: @steemcurator02
Cc: @steemitblog
Cc: @yohan2on
Cc: @bright-obias

#yohan2on-week6 #cryptoacademy #cryptocurrency #nigeria #stablecoins #tether #blockchain