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Here’s How The Tether (USDT) Situation Might Actually Be A Discount Bitcoin (BTC) Opportunity

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Take a look at the top traded cryptocurrencies by volume over the last twenty-four hours and you’ll see the top three as follows: First – Bitcoin (BTC), Second – Ethereum (ETH), Third – Tether (USDT).

That’s right, USDT did more than $2.06 billion in volume since this time yesterday, or the equivalent of just shy of 185,000 BTC.

The coin is currently ranked number 23 by market cap over at CoinMarketCap, with a total capitalization of $2.25 billion – up more than 400% since the start of November last year.

USDT Daily Chart

USDT Daily Chart

So what’s caused the sudden influx of attention and, in turn, volume?

Concerns are spreading that Tether isn’t backed up as the company behind it suggests it is and, in turn, fear, uncertainty and doubt (FUD) reports are hitting press, with some highlighting the potential for a market crash of up to 80% in the value of bitcoin. Any 80% crash would no doubt translate to a considerable amount of collateral damage in the wider cryptocurrency space meaning that this potential event is far from limited in its impact to those holding bitcoin.

The thing is, there’s a lot of talk, but most of it is exaggeration and some of it is outright nonsense.

Here’s why.

First up, for anyone new to Tether, it was set up as a pin to the USD that allows exchanges that don’t want to have to deal with the regulatory nightmare that is dollar-pair trading but that wants to offer its users the opportunity to trade crypto versus the dollar.

In short, the exchanges in question (and we’re talking some big names here – Bittrex, Poloniex, etc.) offer USDT/BTC, USDT/ETH etc. instead of USD/BTC and USD/ETH.

It’s a neat solution but it rests on one important assumption – that the amount of Tether that’s in circulation is equal to the number of US dollars that the company behind the token, Tether, has in its reserves. Tether can’t (or shouldn’t, at least) issue USDT without having USD to an equal amount to back up the issue.

This week, the company announced that it has severed its relationship with an entity called Friedman LLP, which is the company’s (or at least was the company’s) audit firm and, in turn, was the firm tasked with ensuring that Tether has the USD in its bank account to back up the USDT that it’s issued.

This severing of relationships has sparked a return to speculation that Tether’s USD holdings fall short of the number of USDT issued, which has led to reports like this and this hitting press. The fear is that if Tether is revealed to not be able to back up its USDT issue count, the price of BTC would be seen as artificially inflated and/or the exchanges that use Tether would be steeply exposed to an asset (USDT) that is, in reality, worth a fraction of its current pricing.

So why is this not a big deal?

Well, first of all, because there’s no indication that Tether doesn’t have its USD holdings in place. In September last year, the audit company that just severed ties with Tether reported here that the company had just shy of $443 million on its balance sheet.

Second, because even if there was some discrepancy, the impact would likely be far less than 80% dip in the price of BTC. Indeed, when you look beyond the headlines, even the major FUD articles suggest an impact ranging between 30%-80% and when you consider how much volume is tied to USDT, it’s likely to be far less than that – in and around 15% if USDT collapses altogether.

So what’s the opportunity here?

This is a buy the dip trade. As these reports compound uncertainty, we could see numerous dips in the market cap of certain coins, especially BTC. Each of these dips represents a chance to buy cheap coins.

And if things do unravel, the 15% correction is an even bigger chance to do the same.

We will be updating our subscribers as soon as we know more. For the latest on USDT, sign up below!

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency.


Image courtesy of Tether.

Bitcoin

The rise of the crypto casinos

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In the hyper-competitive world of online casinos, operators are always looking for ways to stand out from the crowd. The most usual methods include using distinctive branding, offering generous bonuses and making sure that they are on all of the major so-called affiliate sites where players can compare and contrast casinos’ different offerings.

But now a whole new generation of casinos are starting to emerge – ones whose key difference isn’t what and how you play, but more in how you pay.

The rise and rise of the cryptocurrency casino is seen by many as the next logical step in a world that is slowly but surely starting to accept that Bitcoin, Ethereum, Ripple, et al. are certainly here to stay.

Of course, it’s the first of these cryptocurrencies that has really grabbed the headlines and led the way with its meteoric performance in 2017 when it seemed like its $20,000 value was just the start of the story. Admittedly, this was short-lived and the value quickly fell back to a more sustainable level but, if it achieved one thing, it was to cement this exciting new kind of currency in the consciousness of the general public.

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Investors Beware: Another Large Bitcoin Crash Might Be Coming

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The crypto prices have surged quite high in the last few months. Of course, their progress is nowhere near the one seen in 2017, but they appear to be getting there, one day at the time. However, things might not be as simple as that, and according to recent performance — it is more than possible that a major Bitcoin crash is incoming.

The fact is that cryptos saw a massive amount of growth in a very short period. Bitcoin itself more than doubled its price in only two months. Now, the rally is starting to crash in on itself, and the coin is already about $1,000 lower than last week. If such development does come to pass, a lot of people will experience quite large losses, although experienced investors might find some opportunities, and leverage in order to enhance their holdings’ long-term value.

For example, Bitcoin dominance is expected to crash very quickly, which will work in favor of quite a lot of altcoins. While this does not seem to be the best time to invest in BTC, altcoins are another story, and diversifying a portfolio now might end up being very profitable in days to come.

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The Bitcoin Revolution: Everything You Need To Know To Take Profits

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Bitcoin is soaring high in the cryptomarket once again, and experts are expecting a return of the bullish trend of 2017. The current Bitcoin price is $7,615 as of 23 May 6:56 AM UTC. This significant jump comes just six months after the Bitcoin price plummeted to a low of $3150 in December 2018. Since then, Bitcoin has experienced steady growth and gain in the market. However, in the last 30 days, the Bitcoin price peaked to $8,320.82, its highest price ever. This phenomenal jump occurred in a span of only 10 days breaking the Bitcoin record so far of significant gains made in short time frames. This positive growth has led to experts forecasting the Bitcoin price to hit the $20,000 mark by the end of this year.

Since entering the market almost 11 years ago, Bitcoin is still at the top of the global cryptocurrencies list. The current circulating supply of Bitcoin is at unbelievable 17,708,875 BTC. The market trend of the Bitcoin price has remained positive even when the currency did not maintain an uptrend. Cryptocurrency researchers believe that Bitcoin has the potential to grow up to a high of USD 50,000 within the next two years.

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