Market Analysis

BTC Price skyrockets to 7,500 US dollars as USDT loses its peg

BTC Price skyrockets to 7,500 US dollars as USDT loses its peg
Oct 15, 2018 by Rico Wise

Yesterday, the BTC/USD trading pair closed with just a small 2% gain. However, this pair began picking up the pace in the process of the early Asian cryptotrading session and spiked to 7,800 USD from its previous position at approximately 6,300 USD.

In the meantime, the USDT/USD trading pair kept losing its value, dropping below the 0.95 USD level at the start of the Asian session. It ended up hitting the 0.85 USD low prior to a correction at 0.90 US dollars. Still, the trading pair keeps remaining away from its 1 USD peg, which incites negativity regarding the Tether’s destiny in the digital currency space.

Tether is seriously connected to BitFinex, a worldwide cryptoexchange, which has recently been in the spotlight due to dropping is banking partner, Noble Bank. The sum in US dollars, which is needed to support the USDT coin supply, was allegedly deposited in the same bank, which resulted in the stablecoin encountering problems.

Subsequently, the news have begun to spread that Tether had no funds to support its own total supply, with lots of reporting sources accusing Tether of being a fraud. There was one more interesting discovery made, which is the substantial connection existing between the heads of BitFinex, Tether and Noble Bank, even more so during the period when the policymakers of Puerto Rico expressed their deep concerns regarding the Noble Bank.

According to the reports, the local authorities have issued a warning addressed to the company, with details of the warning remaining unknown to the public.

The next question that arises in the minds of the cryptocommunity members is if Tether actually possesses funds to support its stablecoin supply or not, which can only be discovered by means of a transparent and thorough audit.

Even in that respect, the Tether crew failed to provide, as there has not yet been a single financial audit performed for the organization. Nevertheless, it had employed a team of lawyers for an inspection, although that legal firm had already had connections with Tether and Noble Bank.

All of these facts have contributed to the development of a rather negative reputation for the USDT stablecoin, with retail financiers rushing to exchange their USDT possessions for BTC and other dominant digital currencies, which have also substantially surged within the last 24 hours.

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