By : CTO Paolo Ardoino told Twitter that the firm was able to raise $1 billion in USDT within a short period because big investors know is “trustworthy.”
Trust, Don’t Verify
The New York Attorney General’s office recently opened a very public investigation into the firm. They allege much to the contrary. Tether Limited subsequently admitted it only has 74% of the reserves for its more than $2 billion stablecoins in circulations.
. is able to raise 1b USDt in 10 days, in a private sale. Private companies, giants in our industry and outside, made investments for > 100m each. A legion of inside and outside users made investments for > 1m each.
— Paolo Ardoino (@paoloardoino)
Why? Because they know we are trustworthy, they recognize what we have been doing (without needing us bragging about it publicly) and they want us keep fighting for the industry whole. Their own words.
Thank you everyone for the amazing support we got. We are impressed.— Paolo Ardoino (@paoloardoino)
You read all of that right. Ardoino didn’t mean “cringeworthy” though you may read that on first glance if you’re of a particular mind.
Bitfinex is one of the earliest exchanges to offer fiat on-ramps, and for a long time served as the only way to effectively off-load Tether (USDT) for bank wires. That situation morphed last year when Bitfinex announced Translation: it began listing other stablecoins, including PAX and USDC.
In response, announced a change in its withdrawal fee structure.
USDT Still Dominant “Stablecoin” on Bitfinex
Despite that move, Tether is still the most actively used stablecoin on Bitfinex.
, for example, had less than $500 in activity in the USD/PAX market over the last 24 hours, while USDT/USD had more than $13 million. A Paxos Standard representative wrote to this reporter at the end of last week to report a 30% increase in issuance since the Tether scandal broke, saying:
“With PAX market cap increasing 33% and transaction volume increasing 83% over the past week, this indicates that there is a new demand from both retail and institutional clients for a regulated stablecoin.”
CCN has not verified this statistic, but we’ll take them at face value. The implication is that traders are fleeing from Tether, which is known to be using a type of fractional reserve issuance (without the benefits of FDIC or other regular banking protections).
Let Them Eat $LEO
Bitfinex is executing some big moves directly in the wake of for many other companies in most industries. Meanwhile, bitcoin and other cryptos are booming upward.
Admittedly, a $1B fundraising round for $LEO comes mainly from investors (privately) via their parent company, .
Bitfinex has previously of manipulating the market by researchers and conspiracy theorists alike.
Tether Defender Bingo, play for Tethers
— Eloncarlo”USDT33kByJuly” (@CasPiancey)
The bitcoin market is , as previously discussed.
Its vulnerability to manipulation is in its lack of exchange-traded funds.
Given all we’ve learned over the past 10 years, it would be an oversimplification to say that regulators are “uneducated.”
We know that Mt. Gox’s, for example, when the market was much smaller. We know that . We know that New York State .
But wait, isn’t that the way we’re all supposed to behave in this market?
Right now, we’ve got bright minds from cornerstone firms actively partnering with Bitfinex.
sent LBTC balance from liquid-qt wallet to tradeable BTC balance in 2-3mins. (2 confirms are final on liquid network). similar on see also pilot program (beta). reddit discussion thread
— Adam Back (@adam3us)
And then we’ve got a fundraising event for a new token, with influential voices pumping it:
Announcement from Bitfinex … fundraiser expected to be complete within 7 days
— Alistair Milne (@alistairmilne)
A lot of pieces, but no complete picture.
Yet, onward .
Here, debunk this Tether FUD by the Tether lawyer.
— Bitfinex’ed (@Bitfinexed)
Disclaimer: The views expressed in the article are solely those of the author and do not represent those of, nor should they be attributed to, CCN.
Published at Tue, 14 May 2019 00:00:44 +0000
