Solana’s Price Pumps on Tether Stablecoin.
Stablecoin USDT now runs on Solana, which will attract users and builders to the blockchain network.
The top stablecoin by market capitalization, Tether, is now available on the Solana blockchain today.
This morning, after the announcement, Solana (SOL) tokens went from a low of $13.82 to $16.06, a 16% increase, according to market data by Nomics. Later, it was corrected slightly.
In addition to the Ethereum blockchain and now Solana, USDT tokens can also be found on Algorand, EOS, and Tron and also on a handful of other protocols and networks.
Solana is a proof-of-stake blockchain network that markets itself as a “high speed and low cost” alternative to Ethereum. The Ethereum network struggles to contain high transaction costs and congestion because of the popularity of decentralized finance and non-fungible token applications, many of which are built on the blockchain.
NFTs are also digital assets whose ownership and authenticity could be verified through a blockchain.
Stablecoins like Tether are designed to bypass the price volatility of some cryptocurrencies; the price of USDT is compared to the price of the US dollar.
Once it has been purchased from an exchange or minted, stablecoins could be used to transfer funds between token and blockchain-based platforms without a bank. That makes it easier for people to participate in DeFi. For example, some networks pay interest to those who lend out their stablecoins.
DeFi is where Solana tries to capitalize on. DeFi describes blockchain-based applications that will allow people to lend or borrow money, swap assets, or speculate on the prices without having to go through a bank or other centrally controlled body.
The network added stablecoin functionality in May 2020 and then integrated Tether rival USDC last October. In between, it then created a bridge to Ethereum so that projects on the senior network can migrate to Solana, either permanently or temporarily, during times of high congestion.
As per Tether’s announcement, Solana users could “exchange USDt at speeds greater than 50,000 transactions per second, often for a little as $0.0001 per transaction.” It envisions the addition that helps spur DeFi development on the Solana blockchain.
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