Victor Ugochukwu · Dec 14, 2020 . 5min read
Tether Treasury issued $450 million USDT before Bitcoin price pump
Stablecoin issuer, Tether Treasury mints $450 million USDT before bitcoin price pump and distributes $185 million to exchanges .
By Victor Ugochukwu · Oct 22, 2020 . 5min read
Tether Treasury issued almost half a billion USDT 40 hours ago and distributed $185 million to exchanges before bitcoin price pump. According to Whale Alert’s tweets, the stablecoin issuer minted $150 million and $300 million on October 20th and 21st respectively. Combined, it sums up to $450 million of which 185 million USDT was sent straight to Binance cryptocurrency exchange.
Some speculated and pointed towards market manipulations as an agelong allegation against Tether that it has always had to fiend off. However, the Tether USDT minting came before the PayPal support for cryptocurrencies on Wednesday. Thus it has seen the Bitcoin price pump by more than 15% within the last 24 hours.
Nonetheless, Tether through its CTO, Paolo Adroino tweeted that the transactions were part of the replenishment that required issuance on the Tron Network. Subsequently, Tether conducted at least 15 transactions totalling 185.9 million in USDT. These saw it sending USDT to the wallets of big exchanges like Bitfinex and Huobi. It also sent a couple of transactions in millions into unknown addresses. Tether sent out the largest outflow from its Treasury to Binance totalling $126.9 million.
Tether issuing USDT will lead to Bitcoin price rise? Correlation is not causation.
Last time Tether issued $160 million USDT was in April, and that was when Bitcoin price broke its $7,800 resistance to rally to $9,000. “Tether mints USDT to manipulate the market” exists among the popular sentiments out there. However, a study by the Centre for Economic Research debunks this myth. The research found out that though the Bitcoin price pump may rally, Tether issuance does not, however, inflate crypto prices. Hence, correlation is not causation in the aspect of BTC pump and USDT issuance.
Tether continues to dominate the market and has become the fastest and most popular means of settlement for crypto users. It eliminates the extreme volatility that characterises cryptocurrency transactions and hence employed as a hedge.
From year to date, Tether has grown by more than 400% and just a few million away from reaching $16 billion in market cap. It ranks third on Coinmarketcap and has been tipped to surpass Ethereum in valuation by 2021.
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