There is a phenomenon in the cryptocurrency market known as stablecoins. They include primarily Tether (USDT) and TrueUSD (TUSD). Despite the market slump, Ether, together with Veritaseum, managed to become the only cryptos that showed growth during the collapse on June 10. The same story happened with TrueUSD, which showed positive dynamics on June 13 after a small drop during the beginning of the market crash on June 10. While almost all cryptos started losing their capitalization volumes during the collapse, the "stable cryptocurrencies" managed to go up. As a result, Tether overtook Monero and Dash in capitalization terms on June 11 and took 12th place, which it still keeps today. TrueUSD rose from 217th place to 185th. It managed to climb even at a time when the whole market was actively falling from June 10 to 12.
Stablecoins are cryptocurrencies, which, as stated, are backed by the US dollar. Such claims have been repeatedly questioned in the case of USDT, although there is no precise evidence of the absence of dollar content in these coins. Yes, last year the Tether team interrupted the audit process by Friedman LLP, which could neither confirm or deny the existence of sufficient dollar reserves. But this fact does not mean anything, just as the fact that the owner of Bitfinex and Tether is one and the same.
If you analyze the data on the significant movements of funds in Ethereum on the main wallets of the EOS altcoin team (the movement of funds in the two main wallets EOSCrowdsale and EOS-Owner), it becomes clear that such volumes could influence the rates of cryptocurrency No. 2. After that, one would assume that such suspicions about the Tether team can also have some basis. The amount of funds that the Tether team has, however, in principle, cannot influence the behavior of Bitcoin, the most "capitalized" cryptocurrency. We must not forget that thanks to a successful year-long ICO, the EOS altcoins took fifth place in capitalization, and Tether is at a modest 14th. Having launched the ICO last year, which was completed this year along with the launch of its own network in early June, the EOS team was able to attract investments totaling $4 billion. At presale stage, the ICO raised $850 million.
In addition, despite the fact that 250 million more tokens were recently released, the rate of Tether shows surprising stability. The rate of these tokens does not slump when the entire market drops, but it does not go up either. This is a feature that may not appeal to speculative investors who are accustomed to marking several Xs on various new cryptos.
Such a disappointing feature of Tether should not overshadow its advantage in the form of the stability of its rate. On June 15, Tether costs exactly $1. The maximum was observed on May 27 last year at the level of $1.21. The difference is minus 17%, however, all the cryptocurrencies from the top five in terms of capitalization may well envy such a “fall,” as they have moved much more from their highs. The capitalization of Tether looks especially impressive as it is now $2.62 billion, which is only 1.4% less than the peak value of $2.56 billion, which was reached on June 12. The achievement of a peak against the background of the general weak dynamics of the cryptocurrency market is the best proof of sustainability. Binance is working with Tether, but there has been no distortion, and investors have not moved to Binance, although this exchange accounts for 22% of all turnover of these tokens.
Another stablecoin is TrueUSD. On May 22, Binance, the largest crypto exchange by volume, listed TrueUSD, and this altcoin has become very popular, appearing in many currency pairs. Unlike Tether, there is a bias in favor of Binance, which accounts for 88% of the total turnover of TrueUSD tokens. A strong blow may be dealt to the rate of this altcoin in the event of any difficulties with this crypto exchange trading platform. For example, hacker attacks on the crypto exchange or claims from regulatory authorities are highly unlikely but still possible, since the headquarters of Binance is in Malta.
But if we do not take these risks into account, then TrueUSD shows the same stability as Tether, and it costs exactly $1 currently. The absolute maximum was slightly higher than that of Tether, but not fundamentally. On May 16, the March maximum of $1.3 was surpassed, and the rate of TrueUSD rose to $1.36. At the same time, the capitalization of this altcoin reached a historic maximum of $45.32 million on June 12. Nevertheless, given the lack of diversification of trade, as well as a small volume of capitalization, there are more risks than with Tether.
Both altcoins face unfounded criticism, which is easily refuted by the stable behavior of the rate that they demonstrate throughout the history of their existence. This cannot be said about other attempts at issuing stablecoins, such as the Venezuelan Petro cryptocurrency, which is formally tied to barrels of oil, but the lack of coins on the largest trading floors really raises the question of the stability of their price. Not to mention that oil prices demonstrate significant volatility too.