Ethereum [ETH]’s Vitalik Buterin picks MakerDAI, Augur and Uniswap as top three projects in terms adoption
Vitalik Buterin, the creator of Ethereum [ETH], a leading smart contract platform and cryptocurrency, answered questions pertaining to the project, during an interview with Kobe van Reppelen. These questions were initially asked by the Ethereum community on EthTrader sub-reddit.
Reppelen brought up a statement made by Buterin over a year ago, which suggested that the price of the cryptocurrency had outpaced its development. This was followed by Buterin being questioned on whether he still had the same opinion, considering the current price and development. To this, Vitalik Buterin stated that the developments were definitely moving forward, whereas the prices of the coins were flat, adding “so we’ll see how it goes from here; it’s really interesting.”
Buterin also spoke about what he thought were the successful examples of dApps, or utility tokens in terms of “real adoption”. Vitalik said:
“I mean in terms of like things that people are using, Maker, Augur and Uniswap, kinda seem […] clearly be the top three in, like, a lot of people’s minds I think. People are […] making trades on Augur, people are using DAI, and Uniswap is being used for exchanging all sorts of things.”
Additionally, Buterin was asked whether he was concerned about MakerDao, considering his previous tweets about the project. To this, he stated that he was worried about the fact that there was over 2 million Ether locked up in a smart contract.
[…] I feel like MakerDao team has taken a if more methodical approach to this […] but at the same time like I think it’s important for the community to have kind of a bit of skepticism about just going all the way in a head first and this like Difi thing just because it seems like cool and fancy.”
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Tether (USDT), the cryptocurrency price stable asset, has lost its peg to the U.S.Dollar, which has everyone asking: is Tether in trouble?
Tether, are you solvent?
Tether is a cryptocurrency project focused on providing price stable assets on the bitcoin blockchain that are pegged to the value of and backed by national currencies. However, their peg seems to have become ineffective as market forces are now pushing the price down.
The price of is currently sitting at $0.91 USD, which has resulted in bitcoin trading at a premium on some of the exchanges that use USDT like .
While this may seem like a great at first, allowing users to purchase BTC with USD and sell it for USDT at a profit, some users are beginning to question Tether Limited’s business model and their capabilities to cover the 1:1 USD peg.
One Reddit user and cryptocurrency trader since 2013 has his concerns regarding Tether and the current price discrepancies:
The problem here is that this is creating a very large price spread between exchanges that quote ACTUAL dollars and those that quote tether. This distinction is not being made clear, which I think is having an unhealthy influence on price rallies in cryptocurrencies. Furthermore, I have doubts that this tether is backed by dollars at all and in all likelihood is a fractional reserve.
Meanwhile, others have also pointed to noting one particular sentence that has aroused some suspicion:
There is no contractual right or other right or legal claim against us to redeem or exchange your Tethers for money. We do not guarantee any right of redemption or exchange of Tethers by us for money. There is no guarantee against losses when you buy, trade, sell, or redeem Tethers.
So What’s Going on with Tether?
As many may know, Bitfinex has had some with the Wells Fargo bank, which has limited their wire transfer capabilities. At the time, both deposits and withdrawals are not being processed by the exchange.
This problem also extends to Tether Limited, the company that issues the USDT and EURT cryptocurrencies. Tether has addressed this issue in a recent which reads:
Since April 18, 2017, all incoming international wires to Tether have been blocked and refused by our Taiwanese banks. As such, we do not expect the supply of tethers to increase substantially until these constraints have been lifted.
According to the blog post, the company is currently in the process of establishing new banking corridors, which will allow them to resume withdrawals and deposits. The announcement also mentions that no new USDT have been issued and that Tether continues to maintain a .
One of the co-founders of Tether has also taken to twitter stating that “there is no way that Tether can run a fractional reserve.”
Why is the USD Peg Not Working?
So, if the USDT has kept its 1:1 USD backing, why is the 1:1 peg ? The answer seems to lie both with the lack of liquidity created by the wire transfer limitations and the panic generated by the recent news and rumors.
Users that are in a hurry to receive their USD holdings may prefer to sell USDT at a loss than wait. Not only that, but the cryptocurrency community has also “” from the Mt. Gox disaster.
Thus, it’s no wonder that some are interpreting the current USDT limitations as sign to exit by selling their their tokens as quickly as possible for an asset they can easily withdraw and liquidate like bitcoin. In fact, many believe this is driving the BTC price towards $1,300 at the moment.
In other words, USDT holders that may be interpreting this as a sign of insolvency or outright scam would rather sell at a loss than take the risk of their holdings become worthless.
Still, it is unclear if Tether’s problems are indeed limited to their banking partners or if there are any other unknown issues. If Tether is able to restore its fiat withdrawals/deposits however, then the price should recover back to the normal $1.00.
Do you think USDT will be able to recover back to $1? Could there be any hidden issues with Tether? Share your opinion in the comment section!
Images courtesy of CoinMarketcap, Shutterstock, Tether.to
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