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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Reasons Why You Are Much Safer When Crypto Trading on Dexes
While many cryptocurrencies aim to bring the change to the world by bringing full decentralization, one aspect of the crypto space still remains mostly centralized, and that is the way they are exchanged. Most crypto exchanges are centralized companies, where traders and investors need to deposit their coins for safekeeping. This is a risky way to handle the funds, as exchanges remain susceptible to hacks and theft, as many realized recently, after the hack of the world’s largest exchange by trading volume, Binance.
During the hack, around 7,000 BTC (over $40 million) was taken, and sent to multiple wallets, never to be seen again — for now, at least. The hack also came as quite a shock, as Binance was known for its efficiency, security, and high levels of confidence. It also made people realize that their coins are not really theirs if they need to rely on third parties, such as exchanges, to keep them safe. As a result, many are now turning away from centralized exchanges, and are heading towards decentralized ones — also known as DEXes.
Here are some reasons why you might want to consider doing the same.
1. True ownership of your coins
The crypto community has a saying: “not your keys, not your coins.” The saying is now more relevant than ever, but it does not apply on DEXes. Decentralized exchanges…
Crypto Billionaire Predicts Massive Price Growth by 2021
Crypto prices are once again going up, and Bitcoin has just passed a major resistance level at $6,000. With a situation like that, it is not surprising that everyone in the crypto community is looking forward to the future, wondering what to expect in years to come. Many experts have already given their predictions, some more optimistic than others, but almost all bullish.
Crypto billionaire Mike Novogratz has always been very supportive of cryptocurrencies, and very bullish on Bitcoin. He recently stated that he sees the coins’ prices triple in the following 18 months, meaning that Bitcoin’s return to $20,000 might not be far away, according to him.
He noted that Bitcoin is back to $6,000 after its price hit as low as $3,100 only a few months ago. These days, Novogratz does not believe Bitcoin will return to such lows unless there is a devastating exchange hack or a major shift in regulations. Of course, there was a big hack that had the potential to damage the coin’s price, only days ago. The world’s largest crypto exchange by trading volume, Binance, saw a significant security breach which resulted in a theft of 7,000 BTC.
However, so far, the coin did not react negatively to this incident. While Novogratz believed that such an event would shatter the new confidence in BTC, it simply did not happen. However, he…
TokenRoll (TKR) Platform Will Take Online Casinos to the Next Level
Corporate executives are turning to blockchain technology more than ever in an attempt to revolutionize the business world. Although blockchain is still a relatively new concept, that hasn’t stopped more and more companies from jumping on the bandwagon. This hot new technology has quickly gained a reputation for providing greater transparency, enhanced security, improved traceability, increased efficiency, and low costs. One industry that could certainly benefit from decentralization is the online gambling market, specifically, online casinos. TokenRoll (TKR) has developed a platform that appears to offer a promising alternative to centralized casinos.
Problems with Centralized Casinos
The primary reason why blockchain technology is being implemented so quickly is because it solves a lot of the problems typically associated with the traditional business model. And online casinos are no different. It still needs to be said that centralized casinos have proven that there is a great demand for online gambling. The market is growing faster than anyone could have predicted, and future opportunities appear very promising and lucrative. But industries are continually evolving and this one is no different.
A few of the problems facing centralized casinos include the following:
- Little to no transparency
- Consumer lack of confidence
- Privacy concerns
- 48-72 hour wait time for withdrawals
These are four monumental issues that need to be addressed quickly given the global growth of the market. Casinos need to…
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