Tether USDT Injects $1 Billion into Treasury, Sending Markets into a Frenzy!

Tether USDT Injects $1 Billion into Treasury, Sending Markets into a Frenzy!

  • Tether USDT has injected $1 billion into its treasury, affecting market prices. 
  • Tether has been accused of inflating the price of Bitcoin in the past.
  • Tether has also been under scrutiny due to concerns surrounding its lack of transparency.

The world’s largest stablecoin, Tether USDT, has recently announced a massive minting of around $1 billion in its treasury. This news has sparked speculation among market analysts that a pump in the market is imminent. This is not the first time that Tether has printed new tokens, and in the past, such events have been associated with sudden and dramatic Bitcoin price rises. However, a new study from the Centre for Economic Policy Research suggests that stablecoins like Tether are not the driving force behind the price fluctuations of Bitcoin and other cryptocurrencies.

Despite this, Tether’s frequent and massive minting sprees have led some to believe that they are the ones responsible for Bitcoin price pumps. One such cryptocurrency trader who shares this belief is Andrew Rennhack, who tweeted in early August about the correlation between Tether issuing new USDT and sudden, dramatic Bitcoin price rises. 

Tether Under the Fire

Tether, the popular stablecoin, has been under scrutiny by the New York Attorney General’s (NYAG) multi-year investigation due to a lack of transparency. Earlier this year, Tether disclosed that USDT was not entirely backed by dollars, and that their reserves may include other assets and receivables from loans made by Tether to third parties.

“Tether’s claims that its virtual currency was fully backed by U.S. dollars at all times was a lie,” as per the Attorney General Letitia James. Furthermore, as stated in the court filings, Bitfinex and Tether “recklessly and unlawfully covered-up massive financial losses,” “obscured the true risk investors faced,” “were operated by unlicensed and unregulated individuals”. Moreover, at one point of time, they didn’t even have a back account.

Recently, Tether has been fined and ordered to provide regular reports on their reserves for the next two years. Additionally, the firm is prohibited from conducting operations in New York State. While this may seem like a harsh punishment, industry commentators view this as a positive step towards increased transparency. 

Castle Island Ventures partner and CoinDesk columnist Nic Carter has described this as a historic “derisking event” for the industry. According to Carter, the lack of certainty around USDT has been a significant obstacle for institutions looking to enter the market, despite its prominent role.

Tether Accused of Market Manipulation

In the world of cryptocurrency, a theory has been circulating for some time now.  It is known as the Tether conspiracy theory, and it stems from a research carried out in 2018.

According to the study, the 2017 bull run was manipulated with Tether. The researchers discovered that Tether purchases were timed following market downturns, resulting in significant increases in Bitcoin prices. This controversial claim had captured the attention of both mainstream media along with the supporters of crypto, sparking a heated debate in the industry.

While some dismiss the theory as baseless, others believe that it raises important questions about the integrity of the cryptocurrency market. As the debate rages on, one thing is clear: the Tether conspiracy theory is not going away anytime soon.

End Note

The notion that Tether’s issuance comes before a surge in Bitcoin’s price is gaining traction among some market analysts. A recent report even suggested that the lack of a price increase in BTC following a significant Tether printing could be a sign of an impending bull market.

Although the effects of Tether’s latest printing on the market are yet to be fully realized, it is evident that this stablecoin possesses the capability to sway the value of not only Bitcoin but also other cryptocurrencies. As investors and traders continue to monitor Tether’s movements, the question remains: will it be a catalyst for a new wave of crypto market growth? Only time will tell.