The beginning of 2022 turned out to be difficult for the cryptocurrency market. In November 2021, Bitcoin hit an all-time high of $67,556. After a period of growth, a correction began, threateningly similar to a collapse. On January 22, Bitcoin was trading at $35,030. Analysts talked about the possible beginning of another crypto winter.
The scenario with a retest of the July low and a possible price drop to $20,000 looked quite realistic. These expectations were fueled by news about a possible mining ban in the US, Russia and EU countries.
In any dynamic market, it is extremely important to have a reference asset that is as stable as possible. Such assets serve to fix profits and minimize losses during periods of particularly high market volatility. In traditional markets, this role rightfully belongs to the dollar and precious metals.
The digital asset market needed an analogue of the dollar, and the easiest way to do this was obvious. The dollar had to be digitized.
Tether Limited was the first to implement this idea in 2014. This is how USDT appeared, the first coin, the value of which was rigidly pegged to the dollar. In fact, this is nothing more than a tokenized dollar, and each token is tied to a real-life monetary unit, which is stored in a special account of the company.
Now there are dozens of tokens in circulation, the value of which is pegged to fiat currencies, precious metals and other cryptocurrencies. This class of digital assets is called stablecoins.
The most obvious role of stablecoins is profit taking. The BTC to USDT exchange at the all-time high was a great decision.
In addition to the possibility of fixing profits, stablecoins serve as a link between different types of currencies. They simplify the use of cryptocurrencies for everyday payments. In addition, USDT is used for cross-border money transfers with all the benefits of blockchain technology without loss of funds due to exchange rate differences.
The beginning of February looks optimistic for Bitcoin. The coin began to grow again, bullish signals appear one after another on small timeframes. In the information space, rosy forecasts are circulating about a possible price increase to $100,000.
However, it is too early to say about a radical change in the situation on the market. There are several consecutive levels of resistance ahead, the further fate of Proof of Work cryptocurrencies is still unclear. Of course, cryptocurrencies will not disappear anywhere, as well as attempts by governments to influence the development of the industry.
In addition, price increases are never uniform. On the way to new records, we will inevitably see local lows and highs. Flat periods are not excluded, which are insignificant for long-term investors, but very attractive for traders.
2022 promises to be a busy year. No matter how the market situation develops, cryptocurrency exchange online Letsexchange is always available. Here you can freely exchange Bitcoin for USDT or any other of over 350 cryptocurrencies. Exchange with LetsExchange is always fast, reliable and safe.