Cryptocurrency Q&A
Why is USDT not equal to USD?
Why is USDT not equal to USD?
CharmedSun
Sun May 12 2024
|
7 answers
1181
Could you please explain why USDT, the Tether-backed cryptocurrency, is not equal to the US dollar, USD? I've always assumed they were interchangeable, but recently I've noticed some fluctuations in their value relative to each other. Given the purpose of USDT is to maintain a one-to-one peg with the dollar, why doesn't it always match? Are there factors influencing its value beyond just its underlying asset? Or could it be a result of market speculation or other external forces? I'm curious to understand the nuances behind this apparent discrepancy.
7 answers
Martino
Tue May 14 2024
Tether (USDT) does not always equate to 1 USD.
Was this helpful?
156
30
Giuseppe
Tue May 14 2024
This is due to the fact that Tether is not a direct representation of the US dollar.
Was this helpful?
217
79
ZenBalanced
Tue May 14 2024
While it is partially backed by dollar-reserves, it is still a derivative of the US dollar.
Was this helpful?
108
92
IncheonBeautyBloomingRadianceGlow
Tue May 14 2024
Its value can fluctuate slightly based on market forces of supply and demand.
Was this helpful?
228
84
CoinMasterMind
Mon May 13 2024
Counterparty risk also plays a role in determining its price.
Was this helpful?
304
81
Load 5 more related questions
