Tether (USDT) traded down to $0.94 in early trade Monday, sharply below its 1:1 US dollar peg, while BTC lead the cryptocurrency 10% higher. Despite that, firm stated in yesterday's post that withdrawals are being processed "as usual without the slightest interference".
This isn't the first bout of bad news for Bitfinex this month. If you are wondering what this means: "there are two "synthetic dollars" being traded against one another here: "TrueUSD and Tether the fact that they aren't trading at $1.00 is because someone (Bitfinex, owner of Tether Ltd) is having bank account / liquidity problems,".
Disclaimer: This is an opinionated article, and may not reflect the views of Blockmanity.
Questions surrounding Bitfinex and Tether are nothing new.
Since that time, the BTC price has dropped from $6,700 to $6,549 (-0.67%).
The digital currency market has settled after a frantic 24-hour time caused by the hasty rise in the price of Bitcoin (BTC).
At the heart of this, perhaps, is a lack of transparency.
Tether continues to trade at a 2%-5% discount to the USA dollar, breaking the peg as rumors about Bitfinex and banking problems continue. It can only be found out with a clear and transparent audit. According to the charts on CoinMarketCap, there is more than 20% uprooting in Tether's valuations in the last week. In effect, Tether claims they went and got the next best thing - a legal memorandum. "USDT provides an alternative to Proof of Solvency methods by introducing a Proof of Reserves Process.In the Tether Proof of Reserves system, the amount of USDT in circulations can be easily checked on the Bitcoin blockchain via the tools provided at Omnichest.info, while the corresponding total amount of Dollars held reserves is proved by publishing the bank balance and undergoing periodic audits by professionals". In the span of just a few hours, exchanges recorded billions of dollars volume, quickly pushing this market off its year-to-date lows from a volume standpoint. Momentarily, the price of Tether crashed to sub-90 cents with the entire market rising as USDT was being emptied and money was pouring back into the rest of the market.
Bitfinex has clarified its recent suspension of fiat transactions on its exchange and said that it will have a new improved fiat deposit system by October 16. In the last seven day interval, Tether is -1.27% against the American dollar along with a movement of 0.36% in the past hr.