Thus, you can describe Tether as a contract to buy or trade one US dollar rather than an actual currency. Bitcoin, in contrast, functions as a real currency. In fact, all of Bitcoin’s value is in BTC itself. Tether’s value rests in the US Dollar.
Presently, there only seems to be a market for USD stablecoins. However, I think there will be a demand for Euro stablecoins soon. On the other hand I cannot tell if there is a market for Yuan or Yen stablecoins.
“Due to this increased demand, Huobi Wallet positioned itself as one of the first wallets to support all major stablecoins,” said Huobi Wallet CEO Will Huang.
Tether is a stablecoin. To explain, a stablecoin is a cryptocurrency that contains a smart contract linked to a trust account. A smart contract is an algorithm; or digital robot, that performs a specific act. When you make a USDT purchase, the Tether smart contract releases one $1 in US currency to the merchant.