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Author Topic: How does Tether (USDT) really works?  (Read 584 times)
Colorblind
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October 20, 2017, 02:58:40 PM
 #1

Hope this is the right section to post my question.

I understand basic concepts of 1 USDT = 1 USD and backed by 1$ in Tether account, but what confuses me is how USDT token really works. All I was able to find was that it uses "omnylayer" and "all transactions of Tether are bitcoin transaction". What I am interested in is following:
1. Does Tether have it's own blockchain or uses Bitcoin Blockchain?
2. What happens if I sell my BTC for Tether, and then Withdraw it? What asset will be in my wallet? BTC? Tether? BTC's marked as redeemable for Tether?
3. When I send Tether to another Tether user, transaction being processed by BTC blockchain, meaning I'm really sending BTC's. Why can't I deposit Tethers as BTCs? Who holds private key that signs tether transactions?
4. How Tethers are being issued? I mean if price of 1 USDT fixed to be 1 $ they have to "print" tethers and follow it's circulation between users. But how the hell is this possible if it all build on top of BTC blockchain.

Anyway - I would be thankful if someone could point me to whitepaper or article, explaining Tether in as much technical details as possible.
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sp_skeptic
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October 21, 2017, 03:00:39 PM
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I suggest this thread: Tether: not even a scam https://bitcointalk.org/index.php?topic=1881199.0

or this: The Curious Tale of Tethers: https://hackernoon.com/the-curious-tale-of-tethers-6b0031eead87

Avoid, avoid.
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October 23, 2017, 05:59:14 AM
 #3

I suggest this thread: Tether: not even a scam https://bitcointalk.org/index.php?topic=1881199.0

or this: The Curious Tale of Tethers: https://hackernoon.com/the-curious-tale-of-tethers-6b0031eead87

Avoid, avoid.

Yeah I've seen both of those articles, however, I'm interested more in how Tether actually works, namely if it has it's own blockchain and how USDT being issued.
cointabo
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October 23, 2017, 06:01:16 AM
 #4

I suggest this thread: Tether: not even a scam https://bitcointalk.org/index.php?topic=1881199.0

or this: The Curious Tale of Tethers: https://hackernoon.com/the-curious-tale-of-tethers-6b0031eead87

Avoid, avoid.

Yeah I've seen both of those articles, however, I'm interested more in how Tether actually works, namely if it has it's own blockchain and how USDT being issued.

Tether is on Omni blockchain if I am not mistaken, and they claim they issue 1 tether for every 1 USD deposit in their bank account. However, there seems to be way more tethers in circulation compared to what they have in their bank account(s) - but we cant prove it, as the bank accounts are actually not transparent, and not much is given in regards of the audit process. All in all, never stay in tether for long, it could go bust any moment. But tether blowing up will have a vast negative impact to the overall crypto ecosystem.  Sad
hieu81
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October 23, 2017, 06:06:32 AM
 #5

Hope this is the right section to post my question.

I understand basic concepts of 1 USDT = 1 USD and backed by 1$ in Tether account, but what confuses me is how USDT token really works. All I was able to find was that it uses "omnylayer" and "all transactions of Tether are bitcoin transaction". What I am interested in is following:
1. Does Tether have it's own blockchain or uses Bitcoin Blockchain?
2. What happens if I sell my BTC for Tether, and then Withdraw it? What asset will be in my wallet? BTC? Tether? BTC's marked as redeemable for Tether?
3. When I send Tether to another Tether user, transaction being processed by BTC blockchain, meaning I'm really sending BTC's. Why can't I deposit Tethers as BTCs? Who holds private key that signs tether transactions?
4. How Tethers are being issued? I mean if price of 1 USDT fixed to be 1 $ they have to "print" tethers and follow it's circulation between users. But how the hell is this possible if it all build on top of BTC blockchain.

Anyway - I would be thankful if someone could point me to whitepaper or article, explaining Tether in as much technical details as possible.
Dear all
How to i can backup this wallet and Why fee to withdraw in Bittrex is 5 USDT, it mean: 5 USD /Withdraw. It hight than fee to withdraw BTC at the moment!

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