Stablecoin Tether and Circle's USDC dominate the market.
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Telegram users can now start making stablecoin USDT payments to each other through the encrypted messaging service's linked blockchain.
Telegram, which has roughly 900 million users worldwide, on Friday said it will now give users on the app the option to send USDT — a stablecoin developed and issued by Tether — over The Open Network (TON).
TON is a blockchain network that was initially developed by Telegram, but has since been taken over by open-source developers. It is integrated with the Telegram app.
The blockchain technology underpins most cryptocurrencies.
How it works
Users will first have to go to the Wallet bot on Telegram, which can be found using the search bar in the app, and set up a crypto wallet.
After this, users will be able to purchase USDT and send money to other users by selecting Tether's token as a payment option.
The move could help make Tether's USDT coin more mainstream.
Stablecoins are becoming more popular alternative to fiat coins for users looking to buy and sell digital currencies. These tokens are cryptocurrencies that have prices pegged to an underlying asset, which is typically a fiat currency like the U.S. dollar.
Stablecoins maintain this peg by holding an equivalent amount of assets to their total token issuance at all times.
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They are nevertheless controversial. Doubts have been raised by regulators, investors, and analysts over the source of some stablecoins' reserves — but especially those of Tether.
Critics have also asked whether Tether is sufficiently capitalized to survive a "bank run," after its token temporarily slipped below $1 on several occasions.
For its part, Tether says its token is fully backed by quality reserves and has always been able to meet withdrawals, even at times of distress.
