By Shortly after an announcement made by Binifex yesterday, which pertained to their newfound “neutrality” to Tether (USDT) as well as their intentions to use other stablecoins besides USDT, the crypto firm which has been in the negative limelight these past few months – Tether has finally revived their original business model which enables consumers a 1:1 redemption on USDT for USD on their very own platform:
“Now, thanks to stronger banking as a result of our new relationship with Deltec, Tether is able to return to its original vision of having a wallet for creating and redeeming directly on its own platform without having to rely on a third party. This update allows the immediate withdrawal of Tether to fiat (1:1), with the ability to acquire coming soon.”
However, customers who opt to cash out USDT at Binifex will be subjected to market rates instead of the 1-for-1, along with various other stablecoins on offer. As it has been the case several times in the past, Tether often breaks away from their dollar peg for numerous reasons including market pressures, sometimes by as much or even more than five cents.
Furthermore, Tether also recently published a rate card which outlines the deposit and withdrawal rates of fiat currency on the platform. In order for a consumer to utilise Tether’s withdrawal system directly, they need to be working with a sum of more than $100, 000 and this size they’ll be charged 0.1% in order to make a fiat deposit or the greater sum of $1000 or 0.4% in order to withdraw. In addition to this, customers at any fund size can only make one fiat withdrawal per week with transactions over $1 million being charged at 1% while those above $10 million are charged a hefty 3% or a minimum of $300, 000. Notably, deposit fees are a flat rate at 0.1% no matter the size of the transaction.
Any potential traders seeking to realize potential gains will have to decide what the best route is in order to do so. Currently, there’s no fee for moving USDT in & out of an official Tether account, so traders will need to come up with ways for maximizing the utility of the fee structures at the myriad of places they could potentially exchange USDT tokens for USD and/or other digital currencies.
On the opposite end of the spectrum, there’s the new kid on the block – Paxos Standard (PAX) who charge no fees. However, withdrawals are not instantaneous due to the way the Paxos platform is built but they do occur according to a regular schedule which gets published by them. Circle’s USD Coin (USDC) also doesn’t charge fees for withdrawals but both companies do have a minimum of $100 for conversions.
Lastly, and quite interestingly, on Binance at the time of press, Paxos was trading at a premium against Tether which in a nutshell means that any user that wanted to convert from USDT to Paxo in order to avoid any fees incurred would actually do so at a 1% fee on top of exchange fees. Seems as if, no matter which way users decided to go, they’re going to pay.
Do you currently own any USDT? Are you scrambling to withdraw to fiat? Let us know by commenting below.
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