A lot of events have been unfolding around Tether lately. Stablecoin developers have recently withdrawn billions from the TRON blockchain, with the community blaming the coin for growing fees on the Ethereum network. In addition, the project is still in litigation with US regulators.
Users of the most popular stablecoin suspect something was wrong and are preparing for a drop in the price of the coin, although Tether itself announces an increase in capitalization to a record $ 15 billion. What is happening with the project today and what to expect in the future BeInCrypto learned from experts. We challenge three questions:
1. Tether withdraws money from TRON and Ethereum. What is the reason for this?
2. What is the impact of Tether on the cryptocurrency market, which constantly announces the additional emission of coins. Could Tether repeat the Fed's strategy by filling the market with shell coins?
3. How do you assess the prospects of the project?
Pavel Shkitin, CEO of Nominex cryptocurrency exchange:
- Indeed, over the past two weeks, Tether managed to make several large transactions and moved funds from the TRON blockchain to Ethereum. There may be several reasons for this. First, the transfer of funds may be related to the growing DeFi market. It's no secret that more than half of all decentralized finance projects are created on the Ethereum platform. And since there is now a buzz in this sector, it is quite logical to transfer there a large number of coins that will be in demand. Another thing is that the Ethereum network remains congested and transaction fees remain quite high, up to $ 2.6.
Secondly, the transfer of funds may be related to the revision of the Ethereum strategy. I assume that the company is transferring funds to more popular blockchains, which is fully in line with the project's development strategy.
Thirdly, the reason may be quite commonplace. Tether transfers coins to where they are in high demand. That's all.
Regarding the second question, I believe that the scale of the issue of USDT coins and the scale of the additional emission of real dollars by the Federal Reserve System are simply not comparable. Tether did issue about $ 15 billion worth of coins, but this is a drop in the ocean compared to the trillions of dollars that the Fed issued. Therefore, I believe that there will be no negative result for the entire crypto market from the issue of coins.
It is normal practice for a cryptocurrency project to issue additional coins if they are popular. Namely, the USDT stablecoin is used as a means of payment and is widely used in the DeFi sector. I believe that the additional issue of coins is just the company's response to the needs of the market.
In my opinion, the Tether project is one of the most sustainable on the market. And the more the market develops, the more widely USDT will be applied. I will use the example of the Nominex exchange. In addition, we give our tournament participants prizes in USDT, as in the most popular and demanded cryptocurrency. I believe that the project will continue to develop, replacing the fiat dollar.
Stanislav Itkin, CEO of ZYX Network cryptocurrency:
- I don't see anything suspicious about Tether flipping coins from one platform to another. This is most likely a standard USDT transfer from a platform that is less in demand to the more popular one. We're seeing a DeFi boom right now, so it's no surprise that the demand for the coin on the Ethereum platform is sky-high. Today more and more projects are trying to integrate with Ethereum, as these are additional opportunities. For example, we are also completing a bridge to the Ethereum blockchain in order to create a unified blockchain network. Thus, our coin can be used by projects built on Ethereum. I am sure that Tether is simply strengthening its presence on the Ethereum platform.
USDT is one of the most sought-after stablecoins on the market, so it is quite predictable that Tether will issue additional shares. If we compare the popularity of USDT, then it is slightly inferior to YFI. Now investors are massively buying up not only bitcoin or ETH, but also stablecoins. Among all stablecoins, the dollar-pegged Tether token remains the most popular. I fully share the company's position on the additional issue. As for the FRS, this is really an uncontrolled printing of money, which can no longer be fully provided with US resources. By releasing "helicopter money" to the masses, America is digging a hole for itself, into which sooner or later it will fall. I think that comparing the activities of Tether and the Fed is not entirely correct.
The prospects of the project have been actively discussed for the last 3 years. Skeptics are foreshadowing the closure of Tether from 2017. Optimists believe that USDT will eventually supplant the fiat dollar. But the project is going its own way. USDT is one of the most popular stablecoins right now, and I think it will stay that way for at least the next 3 years.