More people in the world want dollars than bitcoin so I think the idea is to provide that need on Bitcoin so that when they're ready to adopt bitcoin and swap their USDT, they'll already be in the network. Basically more on ramps and deeper liquidity.
Everyone is celebrating the news that Tether USDT is launching on the Lightning Network. Why is this a good thing? What is the advantage compared to Tether on Liquid, for example? I don't understand the hype at all right now. But maybe some of you can enlighten me.
nostr:nprofile1qyt8wumn8ghj7cnfw33k76twv4ezuum0vd5kzmqpz4mhxue69uhk2er9dchxummnw3ezumrpdejqqg909a5z75fgnxzjcej5lur94fq95sw3tc43edkfzucjxczhgncxuc80g2ys nostr:nprofile1qyt8wue69uhh2mtzwfjkctnvda3kzmp6xsurgwqpz4mhxue69uhk2er9dchxummnw3ezumrpdejqqgxy3c5lqj6g9nqpeg0ea7xgdmurrrq9nc8fx5er2930pq8jdc2vzyu7yza6 #Bitcoin
Discussion
That sounds reasonable. If you say they are already in the network. What does that mean exactly? In both cases (Lightning network, Liquid) you need Tether to make a swap. I don't quite understand the advantage of being “in the network” yet.
It's easier to get sats for your USDT if your USDT is already on Bitcoin/Lightning. As opposed to your USDT being on Tron, for example.
Wicked, is there somewhere I can read (in laymans terms) how this actually works? Considering the exchange rate volitility, I don't really understand. Are they going to like wrap a dollar in 10 satoshis or something? I mean, don't they undermine the stability of their "pegged" dollar by transmitting it with bitcoin which could run away from them at some point?
It won't be pegged but it'll be much easier to atomically swap for sats if it's already on the same payment rails.
I guess I'm asking is how is bitcoin, the token, being used to transmit data that can be interpreted to constitute USDT on whatever platform that data is being interpreted. To that end, if the quantity of the btc token being transmitted change in value significantly, won't that impair the stability of the USDT value denominated in USD?
No because the USDT token isn't tied to the bitcoin itself. It's just using the network to transmit and store the data needed to change its ownership. Similar to how ordinal NFTs/shitcoins are doing it.
I'll have to explore it more. It's true though that to send the USDT from ony person to another it would require either a lightning transaction or an onchain transaction right? Even if those transactions are small?
