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Stablecoin Tether Prints $50M Despite Losing $300M in Market Cap

According to block explorer OmniExplorer, Tether has issued new tokens worth $50 million on August 11.

In the last couple of weeks, the market capitalization of Tether is reduced by $300 million, from $2.7 billion dollars to $2.4. This is the second time that Tether registers such a reduction in its supply. In late March, Tether had released 300 million USDT tokens priced at $1 per token.

Tether is now above Ethereum and in second place after Bitcoin in terms of highest daily trading volumes, seeing around $4.6 billion in trades at the time of reporting. The USD-pegged currency is one of the most important in the market grabbing the 9th position in terms of market capitalization. The currency tends to be traded at $1 or in the vicinity, with little variations of a few cents depending on the market. At the time of writing, Tether is trading at 1.01 USD.

On August 11, the price of Bitcoin surged by $300 over the course of just a couple of hours, following a drop to as low as around $6,000. One important observation is that the USDT seems to have a reverse effect on the charts and the overall crypto market as when Tether goes red, all coins are in the green, and vice versa.

For spectators active in this space, the Tether controversy is quite commonplace now and has been the point of focus for quite some time. Many experts have questioned its ambiguity and authenticity. There are doubts about whether the actual funds backing the currency even exist or not. There are controversies afloat in the market that USDT is being used to pump the virtual currency market during hard drops. Though Tether claims that it has requisite amounts of funds to back all the tokens, it has never been audited by more than just one company.

It appears that this conversion from Tether to USD is somehow related to a drop in interest from individuals in the digital assets market. During the last couple of weeks, USDT pairs are being added by some local exchanges in different countries in South American and Africa, in order to lure investors with arbitrage trading.

According to finance professor John Griffin, Tether seems to be sued both to stabilize and manipulate Bitcoin prices.
According to him, the manipulation pattern is only seen at the Bitfinex exchange and no other exchange seems to be involved.

Cryptocurrency exchange Bitfinex, being the seventh-ranked crypto exchange by daily volume on CoinMarketCap, shares leadership with Tether. Both companies have been criticized for lack of transparency.

One of the exchanges where Tether is used the most is Binance. Earlier this month, even the Binance CEO commented that there is always a concern with Tether.

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