BY CNA - October 15, 2018
Bitcoin price jumps, USDT dips below US$1
The price of bitcoin and other major cryptocurrencies are seeing a slight spike at a time when Tether or USDT is moving the other way.
It is unclear yet if there is connection between the tether crash and bitcoin’s rise.
Mati Greenspan, senior market analyst at eToro reckons there is a link: “Even though Tether is designed to keep a steady exchange rate of US$1 per coin, this morning it has seen prices as low as US$0.85 before recovering and is trading on most exchanges around US$0.95 at the time of writing. During the confusion, many cryptotraders who were holding USDT in their accounts decided to protect themselves by placing their money into other cryptoassets, hence the spikes we saw this morning in bitcoin, etherum, XRP, and many others.”
Bitcoin rose to a high of US$6,900 on Monday but later slid back to US$6,735 as seen on CoinMarketCap.
Bitcoin’s price on Bitfinex is the highest at US$7021.
Tether on the other hand, has slid to 95.8 cents.
Tether’s dip below the US$1 mark has led to speculation that it is collapsing and that its supposed US dollar backing will be put to test.
Tether for the longest time has been the leading stablecoin claimed to be backed by US dollars. But as numerous reports have pointed out, Tether lacks sufficient transparency and its dollar reserve has not been been convincingly proven.
Some exchanges have suspended Tether withdrawals and rumours are others will follow suit.