Effects of Coronavirus on Crypto Markets
By Mark Lemon – Cryptocurrency Specialist
Most businesses have seen a decline during the COVID-19 pandemic. Many asset classes have also experienced negative price movement; however this is not the case for all. Notably, Tether has gained 34% market capitalization on the 31st March, approximately $1.6 billion. This could indicate that traders have chosen to buy Tether or swap out to USDT due to possible price movement of the markets.
Tether is the original stablecoin which is pegged with the U.S dollar. This results in very little alterations in price. The cash-like nature of Tether has become more tempting for crypto investors and people who buy and sell cryptocurrency as it can be used to buy ETH, Bitcoin or to buy XRP for example.
Recently, Tether has started issuing its stablecoin on different blockchain networks. It not only runs on Bitcoin, but also Ethereum and Tron. Diversifying the supported ledgers allows Tether to reach more users at reduced costs but in turn, makes it harder for researchers and authorities to track the coin.
Many of the computing networks that support the blockchains are paid out in Bitcoin or Ether. If most users begin to use Tether instead, less may be encouraged to donate their processing power. Less computers mining will impact security which will become more susceptible to attacks.
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