Tether (USDT) is a cryptocurrency that is pegged to the U.S. dollar (USD). Tether is a stablecoin, which means that it’s tied to an underlying asset — in this case, 1 Tether token is tied to 1 USD held in Tether’s reserve. Tied assets may be held in cash or in the form of loans to affiliate companies. This provides investors with a higher level of stability in their investments, as Tether’s price rarely moves very far away from a value of $1. This makes Tether a popular intermediary coin for investors who day trade other cryptos and who want to store a stablecoin in their wallets between trading sessions.
From stablecoins like Tether and USD coin to smaller altcoins like Chainlink and Monero, there are thousands of promising cryptocurrency projects on the horizon that can provide opportunities for investors. Our guide will help you learn more about how to invest in the cryptocurrency market, where to store your tokens, how to decide when you should sell and more.
Is Tether a Good Investment?
You can use Tether as a dollar replacement and use it between exchanges or individuals. It eliminates the need to move money through a bank. Tether is easy to purchase and sell and is available wherever you normally buy cryptocurrencies. Tether is a good option if you feel as if investing in the stock market is risky.
Step 1: Open an Online Account.
The 1st step to buying or selling any type of cryptocurrency is usually to open an account with a broker that supports market access with the coin or token you’re interested in. Crypto brokers work in almost an identical manner to stockbrokers because a crypto broker is authorized to buy and sell coins on your behalf.
The broker that you choose will dictate your trading experience. Here are a few characteristics you might want to consider when you think about which broker you want to work with:
- Trading platform: If you’re a new investor, you might prefer a more streamlined experience. If you’re a more advanced trader, you might want a trading platform with a wealth of charting and analysis tools.
- Asset access: Though most cryptocurrency brokers will allow you to invest in major cryptos like Tether and Bitcoin, each broker chooses its own list of altcoins to offer. Browse coin offerings before you choose a broker to be sure that you’ll be able to invest in all the cryptocurrencies you’re interested in.
- Fees and commissions: Some brokers may charge you a fee or commission on your cryptocurrency purchases. Be sure to research each broker’s fee schedule to know what you’ll pay each time you place a buy or sell order.
Not sure where to begin your search? Consider 2 of our favorite options that offer access to Tether.
BlockFi’s mission is to empower its clients to earn interest, borrow cash and trade crypto from the most trusted financial service providers in crypto. And there are several ways that BlockFi paces itself ahead of similar services.
It’s an independently-owned lender, but BlockFi clients benefit from backing by financial giants like Fidelity and SoFi. This means a roster of products mirroring those you’d find at a large corporate bank are available to you.
BlockFi goes the extra mile to protect its clients by adhering to U.S. law and financial regulations. It stays independent to provide the best rates but works with well-established institutions to ensure your crypto assets consistently perform at optimal levels.
It’s diversified approach means your assets are safe. Because it is secured by a large amount of collateral, BlockFi guarantees you can always easily access your funds.
If you’re looking for a wider range of coins to choose from, consider opening your account with Kraken. Kraken allows you to buy and sell 50 cryptocurrencies, including major names (like Bitcoin and Litecoin), altcoins (like Chainlink, Tezos and Yearn Finance) and stablecoins (like Tether and USD coin).
In addition to a wider selection of coins, Kraken also offers a tiered-fee structure that’s more affordable for large-value investors than Coinbase. Kraken also has a full-time team of customer service professionals who can provide you with account assistance 24/7.
Step 2: Buy a Wallet.
After you choose a broker and open your account, you should choose a wallet. A private wallet is a service or physical device that provides you with a set of private keys you can use to safely store your coins or tokens. There are 2 major types of cryptocurrency wallets:
- Hot storage: Hot wallets are digital cryptocurrency wallets that are connected to your desktop or mobile phone. Hot wallets must be connected to the internet in order to provide you with access to your coins.
- Cold storage: Cold wallets are physical devices that hold your cryptos offline. While cold storage wallets don’t offer access to as many coins when compared to hot wallets, cold storage provides you with the maximum possible security level for your investment.
We recommend storing your coins in a physical cold wallet, which provides superior support when compared to hot wallets. Explore a few of our favorite cold wallets below.
Best for Affordability: Ledger Nano S
Most cold wallet options cost well over $100, which might not be feasible for all investors. If you’re looking for a safe and secure way to store your coins without breaking the bank, consider the Ledger Nano S. The Nano S is among the most popular cold storage wallets, with over $1 million in sales. It’s also a very affordable option with a price of just $51 when you buy through Amazon.
Best for Touch-Screen Access: SecuX V20
The SecuX V20 wallet is another popular choice, offering support for Bitcoin, Ethereum, Tether and any ERC-20 token you might be holding. The SecuX V20 features a full-color 2.8-inch touch screen that allows you to track and manage your coins on-the-go without connecting to a desktop computer. The SecuX V20 also features a simple, streamlined interface that makes it easy to navigate for beginners.
Step 3: Make Your Purchase.
After choosing a wallet and funding your brokerage account, it’s time to place your 1st order to buy Tether. Like buying a share of stock, your crypto broker will likely offer you a range of order options you can use to control the price you pay for each coin. Some common order types you might see include:
- Market orders: A market order tells your broker that you want to purchase a set number of Tether coins at the current market rate. When you place a market order, you won’t specify the price that you want to buy each coin. Your broker will fill the order at whatever price Tether is currently trading at. Market orders are more likely to be filled than other types of orders, but you won’t be able to control how much you pay for each coin.
- Limit orders: A limit order tells your broker that you want to purchase a set number of Tether coins but only at a specific price. For example, you might set a limit order to buy 100 Tether at $0.99. Your broker will only fill your order if it’s possible to buy each coin for $0.99 or less each. If the price rises above $0.99, your broker will not fill the order. Limit orders are less likely to be filled than market orders, but they do allow you to control how much you pay for each coin.
After you place your order, your broker will take over and fill it according to your instructions. You’ll see your coins in your wallet after your order closes.
Trade or Sell Your Cryptocurrency
Tether is unlike most cryptocurrencies because it’s tied to an underlying asset. One of the main reasons that Tether appeals to investors is because it rarely moves from a value of $1. This means that it’s usually not beneficial to hold Tether long term.
Most investors use Tether as an intermediary cryptocurrency. Say you want to purchase Chainlink using fiat currency. After your order closes, the price of Chainlink rises, and you decide that you want to sell your coins. It’s often more affordable to convert your Chainlink tokens to Tether instead of directly back to fiat currency. You can then store your Tether in your cold storage wallet if you think you won’t want to buy in again for a while.
If you plan on trading between Tether and another cryptocurrency frequently, you’ll need a fast, responsive broker. Browse a few of our top choices below.
Current Crypto Prices
Keeping track of how cryptocurrency prices are changing can give you a better idea of the best time to buy or trade. Browse a few of today’s top movers in the market below.
Investing with Less Volatility
Although Tether is significantly less volatile than other major cryptocurrencies, it doesn’t mean that investing in Tether is a guarantee that you won’t lose money. Tether’s team has recently come under fire by the Commodity Futures Trading Commission, the U.S. Department of Justice and the New York State Attorney General, who have launched investigations into Tether’s connection to the price of Bitcoin. If you do decide to invest in Tether, be sure to use it only as a supplement to a fully diversified portfolio of stocks, bonds and funds.
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