BTC - BTCUSD and the USDT Problem
Chart Art as an icebreaker... And now the million (us)dollar(t) question : What is driving the Bitcoin rally?
USDT is a stablecoin supposedly backed 1:1 by real $, yet it has been surrounded by controversy since the Hong Kong company behind tether and Bitfinex never presented an audit of their reserves which are held "off shore".
In fact in 2019, Tether's own lawyer admitted that each
USDT is backed by only 74% cash or "cash equivalents". At that time tether's marketcap was only 5B. It has grown exponentially since the tether machine has just never stopped printing.
This means that USDT could be backed by virtually anything - and the NY Supreme Court doesn't agree. And why would they? Why would the US allow another other country to print a virtual USD? Tether has recently overtaken XRP and now holds 3th spot after Ethereum.
Tether has been facing legal trouble lately, including the threat of a new US Bill that could ruin Tether (if the STABLE Act is passed, Tether will have to obtain a banking license to prove 1:1 assets, which they will never get with only 74% assets and no audit reports).
Currently, there is an ongoing fraud investigation against tether. In April 2019, the New York attorney accused Bitfinex of covering up the loss of $850 million of users’ funds with stablecoins issued by Tether. The authorities claimed that the cryptocurrency exchange operator, iFinex Inc, was also involved in "creative accounting". Moreover, the companies deliberately misled the customers by failing to inform them of the incident. The investigators concluded that Bitfinex transferred $850 million worth of users’ assets to the account of the Panama-based payment service provider Crypto Capital Corp and replaced them with USDT. The regulators prohibited iFinex from providing services to New York citizens and restricted iFinex and Bitfinex access to Tether assets. Bitfinex confirmed the loss of $850 million; however, they claimed that the money was seized from Crypto Capital Corp. They also confirmed that they loaned 700m from Tether; the rest was covered by "other" assets.
In May 2019, the New York Attorney General demanded Bitfinex to provide the documents tied to Tether and reveal the details of their cooperation. The company attempted to claim that USDT was neither commodity nor security, meaning that NYAG had no jurisdiction over the companies involved. However, the New York Supreme Court’s Appellate Division ruled that NYAG and the Attorney General Letitia James can continue investigations into entities behind USDT. These documents will be handed over JANUARY 15th. Ki Young (CryptoQuant CEO) recently tweeted: “If SEC's next target is Tether, it's going to be very, very bad for this bull run as this market heavily relying on USDT.”
What more evidence do you need than a tweet from Ki Young CEO of one of the most advanced crypto analytical companies PROCLAIMING that this rally is driven by USDT and NOT institutional investors.
There is evidence and on chain analytics freely available to prove that the current rally is driven by USDT. As soon as tether stops printing, the price of btc stagnates and even falls.
ALSO WORTH NOTING - The new SEC chairman is self proclaimed "pro - crypto" . Also interesting to see XRP's response after a confirmed Biden-Harris win. Correlation does not equal cause, but it's interesting never the less...
__________________________________
I am not willing to draw to any conclusions on what WILL or MIGHT happen January 15th as I am not a prophet. I am simply informing you of the facts.
Please hit like, I will greatly appreciate it as these articles take time to put together!
Many Thanks,
Ev
USDT is a stablecoin supposedly backed 1:1 by real $, yet it has been surrounded by controversy since the Hong Kong company behind tether and Bitfinex never presented an audit of their reserves which are held "off shore".
In fact in 2019, Tether's own lawyer admitted that each
USDT is backed by only 74% cash or "cash equivalents". At that time tether's marketcap was only 5B. It has grown exponentially since the tether machine has just never stopped printing.This means that USDT could be backed by virtually anything - and the NY Supreme Court doesn't agree. And why would they? Why would the US allow another other country to print a virtual USD? Tether has recently overtaken XRP and now holds 3th spot after Ethereum.
Tether has been facing legal trouble lately, including the threat of a new US Bill that could ruin Tether (if the STABLE Act is passed, Tether will have to obtain a banking license to prove 1:1 assets, which they will never get with only 74% assets and no audit reports).
Currently, there is an ongoing fraud investigation against tether. In April 2019, the New York attorney accused Bitfinex of covering up the loss of $850 million of users’ funds with stablecoins issued by Tether. The authorities claimed that the cryptocurrency exchange operator, iFinex Inc, was also involved in "creative accounting". Moreover, the companies deliberately misled the customers by failing to inform them of the incident. The investigators concluded that Bitfinex transferred $850 million worth of users’ assets to the account of the Panama-based payment service provider Crypto Capital Corp and replaced them with USDT. The regulators prohibited iFinex from providing services to New York citizens and restricted iFinex and Bitfinex access to Tether assets. Bitfinex confirmed the loss of $850 million; however, they claimed that the money was seized from Crypto Capital Corp. They also confirmed that they loaned 700m from Tether; the rest was covered by "other" assets.
In May 2019, the New York Attorney General demanded Bitfinex to provide the documents tied to Tether and reveal the details of their cooperation. The company attempted to claim that USDT was neither commodity nor security, meaning that NYAG had no jurisdiction over the companies involved. However, the New York Supreme Court’s Appellate Division ruled that NYAG and the Attorney General Letitia James can continue investigations into entities behind USDT. These documents will be handed over JANUARY 15th. Ki Young (CryptoQuant CEO) recently tweeted: “If SEC's next target is Tether, it's going to be very, very bad for this bull run as this market heavily relying on USDT.”
What more evidence do you need than a tweet from Ki Young CEO of one of the most advanced crypto analytical companies PROCLAIMING that this rally is driven by USDT and NOT institutional investors.
There is evidence and on chain analytics freely available to prove that the current rally is driven by USDT. As soon as tether stops printing, the price of btc stagnates and even falls.
ALSO WORTH NOTING - The new SEC chairman is self proclaimed "pro - crypto" . Also interesting to see XRP's response after a confirmed Biden-Harris win. Correlation does not equal cause, but it's interesting never the less...
__________________________________
I am not willing to draw to any conclusions on what WILL or MIGHT happen January 15th as I am not a prophet. I am simply informing you of the facts.
Please hit like, I will greatly appreciate it as these articles take time to put together!
Many Thanks,
Ev
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