How does Tether maintain its peg to the US dollar and ensure stability?

3 answers

• Dec 25, 2021 · 3 years ago
  Tether maintains its peg to the US dollar by backing each Tether token with an equivalent amount of US dollars held in reserve. This ensures that for every Tether token in circulation, there is an equivalent amount of US dollars held in reserve, providing stability and confidence in the value of Tether.
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• Dec 25, 2021 · 3 years ago
  Tether uses a combination of market mechanisms and reserve management to maintain its peg to the US dollar. Through market operations, Tether's issuer buys or sells Tether tokens to maintain the peg. Additionally, Tether regularly publishes reports detailing the reserves held, providing transparency and accountability to users.
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• Dec 25, 2021 · 3 years ago
  Tether, like other stablecoins, maintains its peg to the US dollar through a combination of market forces and reserve management. It's important for stablecoins to maintain stability to ensure their usability in the cryptocurrency ecosystem. At BYDFi, we also prioritize stability and have implemented similar mechanisms to ensure the stability of our stablecoin.
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