While Binance Coin (BNB) offers some perks, such as discounted trading fees and the ability to vote on new coin listings, you may be wondering whether it’s worth it to purchase Tether (USDT) instead. But before you invest in either of these cryptocurrencies, it’s important to understand the pros and cons of both so you can decide which one makes the most sense for your investment strategy. Here are a few ways in which Binance Coin differs from Tether, as well as their respective advantages and disadvantages.
What is Tether Coin?
Tether coin is a digital asset that is pegged to the US dollar. What this means is that for every tether coin that is put into circulation, one dollar is kept as reserve. This makes it a stablecoin, meaning its value does not fluctuate as much as other cryptocurrencies. The history of tether coin goes back to 2014 when it was first issued on the Bitcoin blockchain. It was created to provide a way to store value on the blockchain without having to worry about volatility. Today, there are more than 2 billion tether coins in circulation with a market cap just under $2 billion. What is Binance Coin? Binance coin (BNB) has been gaining popularity recently as a cryptocurrency trading pairs with fiat currencies like USD or EUR. It’s different from tether coin because it can be used as a currency itself and can be exchanged for other cryptos like BTC or ETH. As of writing this post, BNB is ranked at 13th place by market capitalization on CoinMarketCap at over $1 billion.
A key difference between these two coins is their utility: while Tether cannot be used to buy goods directly, you can use the Binance token to purchase products and services on their online exchange platform.
what makes Tether different from Binance?
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Tether is a currency that mirrors the US dollar in exchange value. For every Tether coin, the cost is one US dollar. The history of Tether coin goes back to 2014 when it was first created. In November 2017, Wells Fargo stopped providing banking services for Bitfinex, one of the largest exchanges for trading Bitcoin and other cryptocurrencies. As a result, Bitfinex could no longer process wire transfers from their customers which meant they could not accept deposits or withdrawals in USD anymore. To solve this problem, Bitfinex issued Tether coins in order to allow customers to transfer money into their accounts without needing an intermediary such as Wells Fargo. Each tether coin has the same value as a U.S. Dollar and can be redeemed through the issuing company (Bitfinex) at any time with no transaction fee. It’s tethered to the price of the US dollar, meaning that its value does not fluctuate based on what is happening in the market. There are many advantages to using tether: it’s easy-to-use and provides peace of mind for people who want stability in an unstable market.
Advantages of holding these coins
–Tether coin is a digital currency that is backed by US dollars, making it a more stable investment than other cryptocurrencies.
–Tether coin is also less volatile than other coins, meaning that its value does not fluctuate as much in response to market changes.
–Tether coin is easy to convert into cash, making it a good choice for investors who want to cash out their profits quickly.
–Tether coin is also widely accepted by exchanges and wallets, making it a convenient choice for investors.
-History of tether coin: The founders of Tether, Brock Pierce, Reeve Collins, and Craig Sellars, created it in 2014. The company behind tether is based in the Bahamas, and the currency itself is pegged to the US dollar. It is meant to act as a stable asset on the cryptocurrency market. Tether has received criticism from the cryptocurrency community because it has never been audited, so there are doubts about whether or not all of the USD backing exists or if they have ever really been audited. They have also recently come under fire because tether can be used to purchase Bitcoin when Bitfinex has problems with wire transfers (Tether’s account at Wells Fargo Bank).
Disadvantages of holding these coins
When you hold a tether coin, you’re actually just holding an IOU from the company that created the coin. If that company were to go bankrupt, your coins would be worthless. Additionally, there is no guarantee that the company will always be able to redeem your coins for USD, as they claim they can. They also have a history of being hacked, which could lead to you losing your coins. Finally, there is no way to know how many tether coins are actually in circulation, which could lead to inflation and devaluation of the coin. On the other hand, advantages of holding these coins: They offer 1:1 worth with USD meaning it’s easy to convert between currencies. You don’t need to worry about any potential regulations or bans on crypto-trading since it’s fully outside of any regulatory body’s control. The final advantage is that trading fees on this platform are only 0.10% versus most competitors who charge anywhere from 1% – 3%. A major disadvantage of this coin is that if you buy one tether coin and use it to trade every day, then you’ll pay a lot more in trading fees than if you used another type of cryptocurrency such as Bitcoin.
If your goal is to profit off of volatility in the market, then Tether might not be for you because its value has stayed at $1USD for months at a time without much fluctuation.
Conclusion
Overall, both Binance Coin and Tether have their pros and cons. However, it really depends on what you’re looking for in a cryptocurrency. If you want something that’s more stable, then Tether might be the better option. However, if you’re looking for something with more potential upside, then Binance Coin could be a better choice. There are other factors to consider too, such as how much money is currently invested in each coin. As of December 2018, $2 billion has been invested into Tether while $1 billion has been invested into Binance Coin. There are several downsides to the two coins. Firstly, they have little protection against inflation because their prices don’t change much over time. Secondly, they don’t have an associated mining process like Bitcoin does, so they’re not decentralized at all-Binance Coin is even centralized within the company itself.
Lastly, there isn’t any hard limit on what can be purchased using either of these coins which means people can use them for illicit activities like money laundering or funding terrorism.