Some called it a bubble. Others named it the biggest finding of the 21st century. Most simply say, “it's the crypto revolution”. Literally out of nowhere, in 2008, Bitcoin gave birth to an empire of thousands of alternatives for investment, trading, savings, and even payment methods.
Going even further, 1 in 10 people have already jumped into the cryptocurrency wagon, according to a CNBC survey. It's not something only investors get involved in. Up to today, 15.174 businesses worldwide accept bitcoin, according to coinmap.org.
But as we said, the diversity in cryptocurrencies has even turned them into payment methods, and that is where TETHER, better known as USDT, stands out, but…
What´s TETHER (USDT)?
The first thing you need to know is that TETHER is a cryptocurrency hosted on the Ethereum blockchain.
Ethereum is a decentralized, open-source blockchain with smart contract functionality. This means that it is basically an agreement between two people (or entities) in the form of programmed code that executes automatically on the blockchain, which means that its terms are in a database and cannot be changed.
The second thing you need to know is that USDT or Tether is called a stablecoin because it was originally designed to always be worth US$ 1.00, maintaining $ 1.00 in reserves for each tether issued.
Though Bitcoin (BTC) remains the most popular crypto, it tends to suffer from high volatility. For instance:
- US$ 5.000 (March 2020)
- US$ 65.000 (April 2021)
- US$ 30.000 (June 2021)
And this kind of short-term volatility makes BTC unsuitable for use by the public on an everyday basis.
What is Tether for?
TETHER, and any other stablecoin, is pegged to an asset such as the US dollar or the Euro and is primarily used as a payment method.
More importantly, some stablecoins are centralized. For example, if you´re hacked and lose money… Well, you´re not getting it back. But this isn't true for stablecoins.
In August 2021, $600 million were stolen from PolyNetwork and Tether simply froze the $33 million of its tokens that were included in the heist. That rendered those funds useless to the attacker. But this is a topic for another occasion.
If you ask Bruce Mizrach, an economics professor at Rutgers University, TETHER is basically for payments. “The real competitors for USDT are Venmo or PayPal. Most of the time, the fees they charge for transactions are relatively low”, so the next question would be…
How do you get USDT?
USDT can be transacted on popular cryptocurrency exchanges that include Binance, CoinSpot, BitFinex, or Kraken.
Obviously, you need to choose an exchange that operates within your jurisdiction and trades USDT. Then set up an account (but make sure you do your homework before to make the best choice) and then you will need a crypto wallet.
Basically, the wallet is where your newly acquired crypto asset will be safely stored.
Transitioning USDTs is a popular case scenario, but now let's imagine that you just found your dream job, and it's offering USDT as a payment method.
Actually, it's not that hard to find. Since the beginning of the pandemic, more and more companies offer you the possibility of paying yourself via Cryptocurrencies, especially for those who prefer remote work. So how do you turn USDT into cash?
How to sell TETHER (USDT) for USD?
Turning USDT into cash is not like you could just withdraw USDT into your bank account, but it's almost as easy.
Imagine you have been paid in USDT and you previously set up an account in one of the platforms we mentioned (we will use Kraken for this example). How would you turn it into cash? Here is the step by step process:
Sign up in your wallet account
You will need an email address, username, and a strong password.
Verify your account
You will need your name, birth date, county of residence, and phone number.
Send USDT to your account
For this, we could imagine that you already got paid.
Sell USDT for cash
For this, you´ll need to send identification and proof-of-residence documents.
Let´s now swap the platform and go to Binance, where you can sell cryptocurrencies, such as USDT, with no transaction fees on the P2P platform.
But first, do you know what P2P is?
Peer-to-peer refers to the exchange of sharing of information, data, or assets between parties without the involvement of a central authority, an approach often used in trading virtual currencies.
Once on the platform, go to your wallet, then “P2P” and transfer the cryptos that you want to sell to your P2P wallet. If you already did that, then just go to the “P2P trading” page.
Then it's as easy as selecting a coin, taking USDT as an example, then selecting “Sell”. Enter the quantity, select a payment method and click “Sell USDT” to place an order.
Keep in mind that the transaction will display “Pending Payment'' and, after a buyer makes the payments, then it will display “Confirm Receipt”. Then just tap on confirm to release the cryptos to the buyer's account, and that's it.