Seems there is a (very large) market for a legit version of Tether. What's stopping some other company from doing what Tether does with more traditional commercial paper / US based short term loans / govt. bonds / etc.?
Why not use more traditional commercial paper / US based short term loans / govt. bonds / etc. directly then? I mean you can rephrase it but you quickly end up with reinventing the wheel - an old, established, well-regulated, secured and guaranteed wheel.
If you want fiat currency, use fiat currency. If you want a secure location to store and transfer your money, use a bank.
If you want to support a dodgy organization's fake digital money printing scam though, go with Tether.
The point of the article is that Tether is already doing all of this traditional finance stuff under the hood, but just with Chinese paper so they can rake in more yield, but is way riskier.
What I don’t understand is why market participants don’t use those rather than Tether. If I had a bunch of Tether today, why wouldn’t I move it to USDC or similar?
USDT has more supported trading pairs and liquidity, particularly for crypto exchanges in Asia. It just seems more popular there for whatever reason.
If I had to choose USDC or USDT though, I'd rather hold funds in USDC. In general I'm not much of a fan of stablecoins though, but I do acknowledge the quick, 24/7 transfers they offer is interesting, as well as the high APRs for lending them. However, I'd still rather just hold fiat vs stablecoins. I find other cryptos to be much more compelling.
