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Tether Controversies Continue: Does the World’s Largest Stablecoin Have a Future?

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Tether

The crypto market crash of 2018 had brought a lot of troubles for the crypto world, and very difficult time, even for the best and strongest of projects. However, this was also a moment when stablecoins got their chance to shine. Due to the fact that they are pegged to other assets of value, such as fiat currencies, other cryptos, and alike — they were able to keep their prices stable and avoid volatility.

Among them, Tether (USDT) emerged as the most popular and largest of stablecoins. However, the coin also had a misfortune of getting involved in one controversy after another. As a result, many have started disregarding the coin, but even so, it still remains one of the largest cryptocurrencies, currently with $2.78 billion-large market cap.

However, the question of how many more scandals will USDT get involved with remains.

Tether scandals keep emerging

The first big issue with Tether came after it was noticed that it avoids audits which would confirm that all of its coins are backed by an appropriate amount of USD. Scandals continued throughout 2018, and even in 2019. One of the most recent ones came when the project updated its terms and conditions in March of this year. The problem was that it failed to make the changes known to the public.

If any traditional PLC did this, it would face massive consequences, including regulatory sanctions, as well as governmental, media, and even investor uproar. However, when it comes to Tether, the situation is more complex.

The new update claims that reserves which provide Tether coins with the value might include assets other than fiat currencies. Many have taken this as a discreet confirmation that Tether truly does not have enough funds to actually back its coins with $1 per coin.

Another, more recent event, got Tether involved in another controversy when one of the major exchanges — Bitfinex — used $850 million in USDT to cover its own losses. This was a major scandal due to the fact that the used coins were, supposedly, owned by investors, and not the exchange itself. What’s more, it appears that both, Tether and Bitfinex are operated by the same firm — iFinex Inc., which is registered with the British Virgin Islands.

This streak of scandals reflects badly not only on Tether but also on the entire crypto industry. What’s more, it puts the industry in jeopardy at the time when a stable project that would act as a true store of value is highly necessary. Meanwhile, Tether has still not provided a clear insight into its funds, not even to a reputable third party which would be able to confirm the state of things to investors.

Tether alternatives proving their worth

With Tether getting involved in one scandal after another, a number of other stablecoins emerged, trying to offer a more decent service. One example is TrueUSD, which also claims to be completely backed by USD. The difference between TUSD and USDT is that TrueUSD allowed insight into its accounts, thus confirming that it is telling the truth.

The company behind the audit, Cohen & Company Accounting Firm, confirmed that TrueUSD has an appropriate amount to cover its circulating supply. This is also not the only stablecoin that was able to confirm its value. diamDEXX, also known as DIAM, also offers stablecoins, although its tokens are backed by diamonds.

This is a popular project as diamonds have been acting as a store of value for a long time, and they represent a trusted asset that can protect and secure wealth. As mentioned, the company is also fully audited by IDEX, a trusted diamond exchange with a nearly two decades worth of reputable history. The company’s CEO, Jeremy Dahan, stated that seeing investors get disappointed in crypto is becoming a common occurrence.

He mentioned that Tether’s scandals caused investors to start speculating on its price when it should be a stable store of value. With a situation like that, Tether appears to be moving away from what it means to be a stablecoin.

While the stablecoins, in general, are a good thing for the crypto world — a trend which is likely to remain for as long as cryptos remain volatile — the same cannot be said about Tether. Stablecoins need to be transparent, even more so than regular cryptocurrencies. The absolute minimum requirement would be that they are audited by a trusted third party which would confirm that their value is real. Without that, they might as well be a scam.

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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 and read our full disclaimer.

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Altcoins

Rewards Platform StormX Offers 50% Crypto Cashback Bonus for Thanksgiving

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Singapore, Singapore, 23rd November, 2020, // ChainWire //

Blockchain-based rewards platform StormX has released a seasonal promotion for its award-winning Crypto Cash Back App. The promotion will allow app users to earn a 50% bonus on top of their cashback between Thanksgiving Day and Cyber Monday (November 26-30).

StormX has also introduced a brand-new staking service, allowing users to earn an additional 50% per year when they stake STMX tokens. The native ERC20 token of the StormX ecosystem, STMX has a total supply of 10 billion and is available to trade at many of the world’s top exchanges, including Binance and Bittrex.

“With Bitcoin’s price approaching its all-time high, interest in cryptocurrencies has renewed, though some people believe it’s now too expensive to buy in,” said StormX CEO and Co-Founder Simon Yu. “What we have done is create an easy way for such individuals to accumulate bitcoin, ethereum and other cryptocurrencies via everyday shopping.

“We’re also excited to provide users with the ability to earn greater rewards simply by staking their tokens.”

Since the StormX mobile app launched its Shop feature with over 700 stores in February 2020, some 400,000 unique users have been added to the rewards platform. StormX has also witnessed over 50% month-on-month growth for sales. The app is available for download on the App and Google Play Stores, and can be downloaded as a browser add-on from the Chrome Web…

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Altcoins

BITTREX GLOBAL CONFIRMS FREE TRADING AND LISTING FOR TOP DEFI TOKEN

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Valduz, Liechtenstein, 17th November, 2020, // ChainWire //

International cryptocurrency exchange promotes free trading and no gas fees for leading DeFi tokens

17th November 2020 — Bittrex Global GmbH. announced today 8 new DeFi tokens will be listed this week including:

  • UMA (UMA)
  • Aave (AAVE)
  • Balancer (BAL)
  • REN (REN & renBTC)
  • Kyber Network (KNC)
  • Band Protocol (BAND)
  • YF Link – (YFL)

Bittrex Global’s users can trade all of their DeFi  tokens with no trading or gas fees until 2021. The decision to enable free trading on Bittrex Global for DeFi tokens  follows on from the 1,000% growth of the DeFi asset class over the course of 2020.

The decision to enable free transactions will see more investors enter the Blockchain Act’s digital asset regulatory system, supervised by the Financial Market Authority in Liechtenstein (FMA) under the Due Diligence Act which requires traders to comply with the KYC/AML/CFT standards.

“The last year has seen huge growth in DeFi as an asset class and a number of significant milestones completed,” said Bittrex Global’s CEO Tom Albright. “As the asset class matures and more institutional and professional investors look at the fundamentals, we are likely to see increased demand and higher trading volumes for DeFi in 2021.

We’re really excited about what we’re seeing in the space and want to see these DeFi projects grow and help them build stronger platforms through increased adoption. Offering free trading fees…

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Altcoins

Ready for Chaos? Swingby’s Chaos-Mainnet Launches on December 28th

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Singapore, Singapore, 9th November, 2020, // ChainWire //

Swingby is the “warp-speed” protocol for inter-blockchain swaps. It allows all DeFi users to move assets between blockchains without a trusted party. 

Today, Swingby announces its first mainnet network will be released on the 28th of December; it will bridge native Bitcoins onto Ethereum via Wrapped BTC (WBTC).

The initial bridge will enable the most liquid digital asset in the world (Bitcoin), currently valued at a $300 billion market cap, to be moved onto the Ethereum network to tap its $10b DeFi ecosystem.

“This launch will be pivotal to Swingby. After December 28th, Swingby will have a fully operational Chaos-Mainnet network which will be generating a tremendous amount of value to the world of DeFi and bringing in a large number of new users” – Yusaku Senga, CEO

Why is this big news for DeFi?

On December 28th, Swingby will be launching its first Chaos-Mainnet bridge, allowing users to easily move their bitcoins into WBTC on Ethereum without the need for a trusted party. Similarly, the bridge can be used in the opposite direction allowing WBTC-ERC20 tokens to be moved back into native BTCs.

What’s so special about it?

  1. Trustless: Swingby’s Skybridge will be the only way to trustlessly swap BTC into wrapped Bitcoin (WBTC).
  2. Simple to use: The Swingby bridge has been designed to work with standard transaction types removing the need for complex smart contract calls…
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