Tether Untethered: Time for a Pump?
By C2CX Exchange on ALTCOIN MAGAZINE
What’s going on in the tethered crypto world
Today Bitfinex announced it is restarting USDT redemptions on the Tether.to website and ceasing 1:1 conversion into US dollars on its trading site.
Given all the bad press Tether has accumulated, some might say “so what?”
That would be a mistake. This is a big deal, a far bigger deal in fact than it might seem at first glance.
Why?
Probably at least half of all crypto trading is conducted on overseas Chinese exchanges, exchanges like Huobi, C2CX or Binance. Yet none of these exchanges trade directly in fiat currency. Instead, until now they have anchored their exchanges on USDT, holding in some cases hundreds of millions of USDT. Previously these balances could be redeemed into Bitfinex USD within an hour at most, and that in unlimited quantities. Essentially Bitfinex, with its reliable liquidity in most of the major cryptocurrencies, acted as a central bank for all those overseas Chinese exchanges. It’s a fair guess that Bitfinex has not found its role as custodian for several billion USD to be worth the trouble. With the link now cut, that central bank role is now in question.
In that light, it can hardly be a coincidence that on the same day Binance announced it plans to introduce Paxos Standard (PAX) as a new base currency. C2CX has already started adding PAX pairs and will be adding more soon.
Opportunity?
During the past month, USDT has been trading in a fairly tight range, at a 1–5% discount to the other USD stablecoins, offering a fairly low-risk arbitrage opportunity to traders with confidence in it. With this new development, the game is likely to change. The big question: Will Tether go up or down? With a minimum fee of $1000, redemption via the tether website is not cheap, but it is available. Moreover, it’s now trading over parity on Bitfinex. Will the next few weeks see the US Tether price boom? Today US dollar Tether is trading at a 0.6% premium on Bitfinex, so it certainly looks like Tether might be headed up.
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The purpose of ALTCOIN MAGAZINE is to educate the world on crypto and to bring it to the hands and the minds of the masses. This article was written and composed by C2CX Exchange on ALTCOIN MAGAZINE.
