Does USDX Protocol mark the beginning of the end for Tether?

Tether (USDT) has, undoubtedly, been the most successful Stablecoin so far and remains steadily present on the top 20 of all cryptocurrencies (in terms of market cap). Utilising Blockchain technology, Tether is allegedly pegged (or tethered) at 100% to fiat currencies, like USD or EUR. In short, this means that each USDT should (at any time) be reflected in one dollar, held in reserve.

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Additionally, Tether’s secondary purpose was to provide traders with convenient access to purchasing cryptocurrencies, at exchanges that don’t accept fiat money.

Tether, however, is run by a private company called Tether Limited, that also owns the well-known cryptocurrency exchange Bitfinex. Throughout the previous 12 months, many question marks have been raised and their relationship has been under scrutiny, given that Bitfinex offers on-margin trading (backed by USD collaterals).

Taking Tether’s advantages several steps further, USDX’s self-balancing mechanism uses fundamental monetary algorithms, to throttle money circulation as needed. The USDX Protocol’s ecosystem is the first project in the Stablecoin environment that has the ability to adjust every variable of the “Quantitative theory of money” equation. Until now, other Stablecoins struggled to maintain the parity’s stability, by only changing the quantity of money.

The USDX Protocol will address this stability more effectively, with the additional ability to adjust the velocity of money, by implementing three unique mechanisms. The “Variable block reward” and the “Mining lock” mechanisms, that will be able to contract or expand the in-circulation money, and the “Variable transaction fee” that will fine-tune its velocity, respectively.

Attempts to destabilise the parity will only fail, as USDX Protocol’s self-balancing mechanism will immediately adapt to halt the speculating wrongdoing and enforce stability.

Stablecoins’ existence is vital for using Blockchain as a transactional tool and the first-generation (Tether), along with second-generation Stablecoins (pegged to other cryptocurrencies) have failed to provide a concrete and transparent solution in providing stability.

The advent of USDX Protocol in April 2018 is expected to receive wide acceptance, signifying a new era for Stablecoins, and possibly the end of Tether.

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