Is Tether Halal?

Is Tether Halal?

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.

PIF Commentary:

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.

If you’d like to follow the PIF crypto portfolios to see which cryptos we like from an investment perspective, consider becoming a PIF member.

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