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- Several regulators are concerned about the quality of Tether
- The production of Tether has become a joke on social media
- If the firm producing USDT tokens is responsible for manipulating the price of Bitcoin, then the leading currency would face a breakage of its core selling point
As the flagship cryptocurrency is soaring, it is also found to attract skeptics and investigators. Earlier this week, when Bitcoin lost its value by 11%, the Financial Conduct Authority (FCA) of the United Kingdom cautioned the investors to prepare for losses. Tether (USDT), the third-largest crypto token by market capitalization, which is unique among its peers, claims to help Bitcoin fuel. New York’s attorney general office is also investing on the same subject, whether its attractive quality is a tool for virtual currency insiders to get rich or inflates the leading token’s value.
Production of Tether as a joke on social media
In recent years, it was observed that the importance and value of Tether stablecoin had become a joke in social media. Several accounts like “whale_alert” and “glassnodealerts” that monitor large outflows have attracted several users’ sarcastic replies. The users have also claimed that the firm is running a Ponzi scheme and rocketing to pump the Bitcoin market indirectly. However, whatever New York investigates, there are several strange criminal characters involved in USDT’s history.
USDT claims to mint new coins according to response
The stablecoin, founded under the brand name Real coin, is not decentralized compared to the flagship currency. USDT is only owned by one firm that mints and manages the supply of the token. Observing the aforementioned fact, it is clear that the token is not transparent. However, unlike other cryptocurrencies mined, Tether’s production isn’t bound by math and code, which iterates the supply.
USDT claims that it mints new coins only in response to need. The critics notably argue on the fact. It is also found that along with critics, several high-powered lawyers, rogue economists, crypto industry whistleblowers, crypto gadflies, jaundiced traders, and other US regulatory agencies claimed that USDT is a part of a scam that is boiling down to use the firm’s currency to fuel Bitcoin.
Dollar pegged USDT has a certain unreality in it
Observing several concerns about Tether, individuals are now afraid of whether the coin will collapse. The chances that the coin would collapse include a government crackdown, or a run on the Tether bank, or the price of Bitcoin. However, the critics of USDT are right, and this is a rehash of the last bubble. The firm will not be able to bear down for a longer-term. On the other hand, if the price of the flagship crypto token can be manipulated by firms printing virtual currencies, the fact would undercut the critical selling point of BTC.
