How can USDT help with inflation in Nigeria? There is no denying that high inflation is a problem for the world economy, with inflation in Nigeria reaching its highest level recently as a result of rising food costs, gasoline shortages, and supply disruptions.
With the use of the dollar and the USDT, many Nigerians are now attempting to protect themselves against excessive inflation as well as a potential naira devaluation.
In the middle of this, the value of stablecoins like Tether (USDT), USDC, and Binance USD has skyrocketed. Stablecoins are based on the same kind of blockchain-based online ledger technology as other cryptocurrencies.
However, the value of these digital assets is matched 1:1 to a traditional financial asset, often the US dollar. Stablecoins allow investors to store less erratic money in their digital wallets, negating the need for a bank account.
The main objective of this movement is to declare independence from banks and other centralised financial institutions, and stablecoins make that possible.
Investors will be better protected if they retain a sizable portion of their money in stablecoins rather than only saving in volatile instruments because most crypto assets and global stocks go up and down together as well.
Is it Safe to Keep Some of Your Naira Investments in USDT?
For people who wish to invest in cryptocurrencies but can’t tolerate the waves of volatility, stablecoins might be a suitable option. Before investing, you must be aware of anything.
The profits on USDT or other stablecoin investments won’t be spectacular. Generally speaking, because they are intended to be stable, their pricing doesn’t change all that much.
Popular stablecoins like USDT, commonly known as Tether, have only grown by 0.16% this year and 0.42% over the past three years.
Long-term ownership of these assets may yield interest, but this is effectively a riskier form of saving.
You can use your USDT in addition to lending and staking. USDT can be used to generate income as well. You can get interest if you lend stablecoins to borrowers. You can get paid when you stake your own stablecoins. The profit you could receive could increase in value as you donate more USDT.
Making money online with these possibilities does require more work than simply purchasing and holding these digital assets.
Risks Associated with Holding Stablecoins like USDT
Stablecoins have dangers attached to them. Due to the fact that the cryptocurrency market is mostly unregulated, these digital assets have often seen their fair share of controversy.
- It is unclear whether these stablecoin suppliers have sufficient cash on hand to keep their stablecoins’ 1:1 fiat rates stable during a crisis.
- There is no automatic 1:1 ratio. Providers of stablecoins are required to maintain a reserve of money equivalent to the market value of their stablecoins, which fluctuates in response to investor demand and supply.
- It is not exactly accurate that stablecoin providers hold reserves equivalent to 100% of the value of their stablecoins.
- Last but not least, an overheated global economy might lead to high inflation and a recession in the economy. People would shift their money out of hazardous assets and bonds, making the dollar a safer shelter. The value of these riskier assets, such as commercial paper, would fall.
As a result, stablecoin providers would sustain significant damage. In the event that investors panic and attempt to exchange their stablecoins for dollars, the stablecoin providers might not be able to repay everyone’s funds at a 1:1 ratio. The global financial system as a whole and the cryptocurrency market might both be impacted.
[Read Also: How to Save Money In USDT]
How Much is 100 dollars USDT in Naira?
Since USDT is tied to the US dollar, $100 in USDT is equivalent to $100 in US dollars. There may be variations, however, these variations are frequently smaller than 0.1%. If you possess USDT, it will be worth exactly one US dollar. But with Breet, there are no fees, so 100 USDT is $100. According to Breet’s rate calculator as of Dec 16, |$100 USDT in Naira is N71,500.
3d illustration Wallet of different cryptocurrencies like USDT
Utilising Stablecoins: How USDT Trading Could Help
The use of stablecoins is one of the alternatives that tech-savvy young people in Nigeria have proposed. These digital currencies are linked to the US dollar. In contrast to keeping the Naira, whose monthly inflation can be as high as 20% or more, their value is consequently more stable.
In addition to enabling access to US dollars without relying on Nigeria’s centralised banking system and all of its limitations, it is also less expensive and quicker. It can take days to process a regular foreign currency transfer from the US to Nigeria. Additionally, fees may be very costly. The percentage that payment processors collect from each transaction can reach 10%. Making foreign transactions for Nigerians frustrating.
The transaction with USDT happens in under a minute. The USDT you have in your wallet can then be used for regular transactions. Depending on your business partners, some multinational companies will even take USDT as payment for goods and services. The outcome is a straightforward, practical way to carry on doing business.
How to Sell USDT in Nigeria & Get the Best USDT Rates
You should use Breet App to sell USDT in Nigeria. If using P2P exchanges, search platforms with reputable sellers. Use a platform with an escrow service and a solid reputation. Additionally, it’s a good idea to carry out numerous transactions when converting USDT to Naira in order to spread out your risk and minimise it when trading with a peer. Thousands of consumers have found it simple to sell USDT in Nigeria, thanks to Breet, which today become the industry leader in supporting USDT – in all 3 tokens. With Breet, you can quickly sell your Tether (USDT) in seconds without having to wait long for a peer. And there’s no fear of dealing with a fraudulent peer since you’re not dealing with anyone – no peer, no third parties. As the cryptocurrency market grows, we think that this will be the way that trading will be done in the future.
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