Surprisingly, Tether (USDT) could become, very soon, the 10th most important cryptocurrency by market capitalization. In order for this to happen, Tether should increase its market capitalization, or a top 10 coin should fall under $2.52 billion dollars.
Tether to Reach the Top 10
Tether is a cryptocurrency that is linked to the dollar and it is used by several traders all over the world to hedge against other virtual currencies. It is used as a safe haven in those exchanges that do not offer crypto-to-fiat pairs.
During the last months, Tether has been involved in scandals related to the funds the company says it has backing each Tether circulating. At the same time, the company has been accused of trying to manipulate the price of Bitcoin.
According to a study conducted by John Griffin and Amin Shams, Tether has been used to stabilize Bitcoin prices. As reported by Bloomberg, every single time that Bitcoin registered important loses, an important amount of Tether were printed and transferred immediately to Bitfinex. After it, they were used to mitigate the drop.
The paper reads as follows:
“Tether seems to be used both to stabilize and manipulate Bitcoin prices. […] The hype in cryptocurrency isn’t just 20-year-olds buying Bitcoin in their garage – that’s part of it – but there are big players moving the market and having a huge price impact.”
Of course, from Bitfinex they say that Tether has never been used in any kind of market or price manipulation.
“Bitfinex nor Tether is, or has ever, engaged in any sort of market or price manipulation,” commented Bitfinex Chief Executive Officer JL van der Velde. “Tether issuances cannot be used to drop up the price of Bitcoin or any other coin/token on Bitfinex.”
At the moment of writing this article, Tether is the 11th most important cryptocurrency by market capitalization ($2.52 billion dollars). Tron is the 10th and it is just $18 million dollars away from letting USDT enter the top 10.
Virtual currencies have been losing an important part of their price in the last weeks. Until now, there is no sign of recovery. And it would be interesting to see whether new Tether will be printed or not in the next days. If the hypothesis presented by Griffin and Shams is true, it is very possible that USDT would be printing more USDT.
Image Provided by Hacker.com.