Ethereum Embraces Tether’s USDT And Now Its Value Is Threatened

Ethereum embraces Tether’s USDT after it became a subject of a few different trends when stablecoins tied to the value of the asset as we are reading in the following ETH news.

Stablecoins became a huge trend and now there is now more than $5.6 billion worth of Tether’s USDT stablecoin issued on the Ethereum network as opposed to the $1.3 billion on the Bitcoin Omni network and about $800 million on Tron. The primacy that Ethereum has in the stablecoin space, with assets like USDT, USD Coin, and the Paxos Dollar which could present a huge risk to the value of ETH.

The ETH users continued to embrace Tether back on Monday and most of the startups and investors staked in Compound which is a leading DeFi protocol that voted in support of adding USDT to the protocol. This move signals that the stablecoins have become the core to Ethereum right at the time as Ethereum embraces Tether’s USDT. Stablecoins became important to Ethereum according to the data from Messari because of the transactions of USDT and other dollar-pegged tokens so the total value of the transactions took place on Ethereum which started rivaling Bitcoin. The founder Mythos Capital Ryan Sean Adams explained:

 “In Feb 2016 the reserve asset of Ethereum traded at $2. If I told you then that 4 yrs later this network would host over $9b in stablecoins & that’s just one of its promising use cases you have been blown away. You would have backed up the truck. That’s how I feel about ETH today.”

Still two days left, but looks Compound will be adding supply/borrow support for Tether soon

Felt like the DeFi community was initially hostile towards Tether and is now embracing it (for better or worse 🤷‍♂️) as more $USDT moves from Omni to Ethereumhttps://t.co/jy9i0yqGGD pic.twitter.com/8nncugPCqL

— Rob "Crypto Bobby" Paone (@crypto_bobby) April 27, 2020

Adam’s comments make it clear that the investors in Ether are embracing stablecoins as a key use case of the blockchain technology that is supposed to boost the value of Ethereum while the sentiment is mounting and the opposite of the prediction is coming true. Ryan Watkins who is an analyst and researcher at Messari believes that the presence of Tether and other stablecoins on the blockchain will pose a huge threat to ETH’s value.

Watkins said that if stablecoins continue to be the primary value of the transfer mechanism on the network, the monetary premium of Ethereum and the position as a potential form of money, may devolve into a ‘’naïve early branding of digital oil’’ and lose a lot of the value as a result. Many critics of Bitcoin say that the primary thing that holds this asset back from becoming real money, is their high level of volatility.