While generally halal, we think a cryptocurrency can be haram if it is primarily used for a haram purpose.
So we’ll examine this cryptocurrency’s utility to determine our level of comfort investing in it.
What is Tether and what is it used for?
USDT is a stable coin (short for stable-value cryptocurrency) that mirrors the price of the U.S. dollar.
Stable coins like Tether can be used for purchasing other cryptocurrencies, money transfers, and saving.
There is nothing inherently haram in the specific utility of Tether, although it is questionable whether it can maintain a peg to the dollar indefinitely.
The company that issues Tether, Tether Limited, doesn’t have the best reputation.
For example, they previously claimed that every Tether coin was backed by $1.
That was later revealed to be a lie.
In March 2021, Tether Limited released information on its reserves, which showed that only 2.9% of Tether is backed by cash.
Is Tether Halal?
We’re comfortable with the utility of Tether from a halal perspective although we don’t trust the parent company of the coin.
We would not use Tether for anything other than a quick trade or transfer.
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