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Tether - A word of caution over Tether stablecoin safetyIn our previous posts, we warned about de-pegging of the Tether stablecoin from the U.S. dollar. The precedent was set when Luna stablecoin fell 99%, spilling to other tokens and temporarily breaking the peg between the USDT and USD. With the recent crash in the cryptocurrency market, we remain very pessimistic about its outlook. Illustration 1.01 The picture above shows the precedent that took place on 12th May 2022. The Tether token can be seen losing almost 6% of its value against the U.S. dollar. Already back in July 2021, Jannet Yellen, the U.S. treasury secretary, summoned Jerome Powell and the head of the Securities and Exchange Commission to discuss Tether and the danger it poses. Then in October 2021, the Commodity Futures Trading Commission (CFTC) filed and settled legal cases against iFinex Inc. , BFXNA Inc. , and BFXWW Inc. The actual text (only excerpts) from the CFTC website 1st excerpt “The Tether order finds that since its launch in 2014, Tether has represented that the tether token is a stablecoin with its value pegged to fiat currency and 100% backed by corresponding fiat assets, including U.S. dollars and euros. However, the Tether order finds that from at least June 1, 2016 to February 25, 2019, Tether misrepresented to customers and the market that Tether maintained sufficient U.S. dollar reserves to back every USDT in circulation with the “equivalent amount of corresponding fiat currency” held by Tether and “safely deposited” in Tether’s bank accounts. “ 2nd excerpt In fact Tether reserves were not “fully-backed” the majority of the time. The order further finds that Tether failed to disclose that it included unsecured receivables and non-fiat assets in its reserves, and that Tether falsely represented that it would undergo routine, professional audits to demonstrate that it maintained “100% reserves at all times” even though Tether reserves were not audited. 3rd excerpt “Tether held sufficient fiat reserves in its accounts to back USDT tether tokens in circulation for only 27.6% of the days in a 26-month sample time period from 2016 through 2018. “ We raise a word of caution as to the question of stablecoin safety - in this particular case of Tether . Illustration 1.02 The picture shows another anomaly in the price of Tether, but this one started to occur yesterday. Please feel free to express your ideas and thoughts in the comment section. DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
COINBASE:USDTUSDShort
by Tradersweekly
17
Timing the Market Using Tether DominanceI always emphasize that time in the market beats timing the market, but I want to share an interesting approach that you can consider taking when timing the cryptocurrency market, especially when it comes to Bitcoin's overall direction. This is not financial advice. This is for educational purposes only. Tether Dominance - Just as Bitcoin dominance refers to Bitcoin's market cap relative to that of the entire market cap, Tether dominance is no different. - It refers to how much capital is parked in stablecoins, specifically Tether, at any point in time. - Since Tether (USDT) is a stablecoin that tracksthe USD, an increase in Tether dominance suggests a pullback or correction in cryptocurrencies. - A simple way to understand it is to think of USD flowing in and out of the market. - On the other hand, if Tether dominance drops, it means that more capital is being deployed to purchase cryptocurrencies, which is bullish overall for the market. - If you look at the graph above, you'll clearly see the inverse correlation between Bitcoin (orange) and Tether dominance (black). - Key support and resistance zones for Tether dominance are marked as well. - As we're currently trading slightly above local support, marked in green, if we see Tether Dominance fall below those levels, we could expect Bitcoin to continue rallying upwards. Bitcoin Daily Chart Analysis - We've tested Bitcoin's yearly open price at $47.2k, and failed to break above the 200 simple moving average (purple). - Bitcoin has retraced to $45-46k levels, which is a completely anticipated move considering that pullbacks can take place upon breakouts. - As the overall structure remains bullish, and we see the moving averages cross again, aligning in order for a bull rally, I expect us to retest $50k ranges again. - Whether we get rejected at those levels, or break through it is unclear, but we'll take it by levels as we always do. Conclusion With Tether dominance currently barely holding local support, I think there's a high probability that we see those support levels break down, and see Bitcoin rally upwards once again. This is definitely an indicator that you want to continuously refer to as you trade. If you like this educational post, please make sure to like, and follow for more quality content! If you have any questions or comments, feel free to comment below! :)
Editors' picks
CRYPTOCAP:USDT.DEducation
by Michael_Wang_Official
38
9 Millionth Bitcoin Has Been Mined, Could We See a Pump?Monthly Time-frame We have closed a green candle on March. Rejection area or the supply zone is at $47,100. Good to open short position at the moment. a test to the demand zone is also possible for stronger pump to the upside. Demand zone is waiting at $37,700. This is possible if the stock market starts crashing. Weekly Time-frame We still have 1D and 21 hours left for the next weekly candle. $42,486 is a test of the demand zone. We are currently in the low volume node in VPVR which is easy to break to the downside. 1D Time-frame We are about to form double top as Bitcoin and Stocks usually does it to get more retailers to be greedy and fearful. then gets dump again. Awesome Oscillator is still bearish with red volume ripe for correction. 4H Time-frame Our Long signal in the afternoon made us good profit. our signal in the evening is too early to short most have hit their stop loss already. The market usually makes double top to liquidate the short and long first before continuing the downtrend. We can expect more to the downside in the following days. Supply zone is being respected we can start opening short position at $46,517, $47,440 and keep stop loss above the previous high. SL at $48,548 to make sure not to hit the sl. We will discuss more on the possibility on our Live. Stay tune and check with us! Want more insights before US market open? Hit Like, Share, and Subscribe for more daily trading tutorial & cryptocurrency news Trade Scholar, the best cryptocurrency educational community online! Find the content above difficult to understand? Feeling lost about how to trade? Want to learn how to do your Own Price Prediction? We endeavour to share you our investment knowledge & experience in order to help you starting your path to financial freedom. Follow, Subscribe & Join our Community to trade together! Disclaimer: Above Technical Analysis is pure educational information, not Investment Advice. The information provided on this post does not constitute investment advice, financial advice, trading advice, or any other sort of advice and you should not treat any of the website's content as such. Do conduct your own due diligence and consult your financial advisor before making any investment decisions.
Long
by Trade_Scholar
Time For Bulls To Gather Momentum at 44,500!!Weekly Time-frame We are still in the Demand and supply area until one gives way either to the upside or to the downside. Trading area $48,000 to $46,000. We might end up having a dump this April fools and create a Flip zone instead of Rally Base Rally. 1D Time-frame We are not yet overbought in 1D TF. But the rejection from $48,200 sting a lot that it's having hard time going back up. We can expect bearish candle today as we have a bearish engulfing candle stick pattern. Greed and Fear Index now at #52 still in Greed but this is bearish. 4H Time-frame Confirmed we are staying inside the demand zone. Planning to flip it into a supply zone and start dumping. We will see if the bears will be able to flip the zone. Double top breakout confirmed to the downside. 1H Time-frame Just as I said before that we will be crossing in the thinnest part of the cloud. Now in 1h TF we can see we are crossing in the thinnest part indeed. We will discuss more on the possibility on our Live. Stay tune and check with us! Want more insights before US market open? Hit Like, Share, and Subscribe for more daily trading tutorial & cryptocurrency news Trade Scholar, the best cryptocurrency educational community online! Find the content above difficult to understand? Feeling lost about how to trade? Want to learn how to do your Own Price Prediction? We endeavour to share you our investment knowledge & experience in order to help you starting your path to financial freedom. Follow, Subscribe & Join our Community to trade together! Disclaimer: Above Technical Analysis is pure educational information, not Investment Advice. The information provided on this post does not constitute investment advice, financial advice, trading advice, or any other sort of advice and you should not treat any of the website's content as such. Do conduct your own due diligence and consult your financial advisor before making any investment decisions.
Short
by Trade_Scholar
4
USDT.D Daily Analysis🟢USDT's dominance bounced from the uptrend line support to form a twin floor pattern and is now above the neckline of this pattern, which also acts as a support. If the retest is successful, it is expected to move upwards, which will be a sign of decline for the market because the USDT and BTC dominance are inversely related to each other. Use the appropriate loss limit for your trades, which has a very high possibility of emotional movement in the market. ⚠ This Analysis will be updated. Amir Hossein 📅 02.19.2022 ⚠️ (DYOR)
CRYPTOCAP:USDT.DEducation
by Trader_Needs
3
When TetherUSD Spikes, The Market DivesJust something I've been noticing lately. Whenever the price of Tether compared to USD has a spike above $1.00075, the entire market will dive a minute later. The symmetrical dive of every token is obviously in response to one temporarily neededing less USDT to buy every token. Is this an opportunity for those with custom bots to craft an algorithm to close all the trades when this is detected. Something, as it is indeed a repeating trend. Is Tether at fault for not balancing their coin fast enough to stop this. It obviously triggers bots to sell, which causes more bots to sell, which then causes humans to sell... And then whales to buy. Let me know what you guys think? See for yourselves ; the finer the definition on the chart, the clearer it is to see. Happens at 12:37am. Cheers!
BINANCEUS:USDTUSD
by WILLIAMAXX
1
Evergrande and the Cryptocurrency Market Selloff ExplainedIn this post, I'll be providing an explanation on a theory regarding the potential connection between China's giant real estate developer, Evergrande, and Tether. If you aren't familiar with Evergrande and the crisis it's currently going through, make sure to check out my previous post below: Disclaimer: This is not investment advice. This is for educational and entertainment purposes only. I am not responsible for the profits or loss generated from your investments. Trade and invest at your own risk. Evergrande's Shadow Banking Funds - In my previous analysis, I mentioned the existence of Evergrande's $67B liability from shady sources. - People, including renowned investors like Michael Burry, are posing doubts as to whether this liability has connections with Tether, a company that offers stablecoins in the cryptocurrency market. About Tether - Tether offers $USDT, a stablecoin that is convertable for 1 USD. - Essentially, what it does is not so different from what banks used to do, and continue to do today. - During the gold standard, when you took $500 to the bank, they'd give you an ounce of gold. - Tether guarantees that they'll provide 1 USD per 1 USDT - But, some say that Tether is faced with a bank-run like situation, looking at its reserves. - According to their March 2021 Reserves update, commercial paper accounts for 65% of Tether's cash reserves. - For those of you who don't know, commercial paper, or CP, is a way to finance extremely short term loans at a very cheap rate. - Tether did not disclose whose CPs they were, in order to protect their partner's privacy. Tether's Commercial Paper - Back in July this year, Tether’s CTO and general counsel had an interview with CNBC, and made a few important points. - They said that they have about $30B in AA rated International Commercial Paper, and these were rated AA by S&P and Fitch. - The point that some people are making is that Tether’s commercial paper might actually be Evergrande’s commercial paper. - This may seem like a conspiracy theory, but there are certain points that line up. Reason #1 - First, Tether currently has $30B in commercial papers, and that’s an insane amount of money. - Reuters reported that Shengjing Bank, the bank affiliated with Evergrande, is under investigation for providing illegal loans up to $20B. - Considering that even a more renowned company like JP Morgan can’t write $20B loans, there is plausible reason to doubt that the capital may have come from Tether. - So taking into consideration the size of the loan, some say that it’s highly likely that the capital flowed into Chinese real estate companies. Reason #2 - Secondly, even after Bitcoin peaked in mid April, Tether continued to print more USDT. To be precise, they printed $15B between mid April and early June. - In case you don’t know what bitcoin has to do with this, there have been claims that Tether has been arbitrarily printing USDT. - This USDT would be used to manipulate the price of Bitcoin, and the overall cryptocurrency market in general. - While Tether has been printing money like crazy, and as soon as Evergrande CPs defaulted on June 7, they stopped printing USDT. - Now this is a chicken or egg question where we don’t know if Evergrande’s liquidity problem caused Tether’s collateral to impair, or whether Tether’s cutoff caused the liquidity issues at Evergrande, but something sure smells fishy. How the Market Structure Would Break - Tether claims that they don’t hold any Evergrande commercial papers, but we don’t know anything for sure yet. - If it turns out that Tether was lying, and we see a domino effect take place, it would look something like this: - Evergrande, along with other real estate developers in China, would go default. - Tether, who lent them money in the form of commercial paper, could also go default. - And with tether going default we would see the cryptocurrency market take a huge hit. Where is Bitcoin Headed? - So at this point, you may be wondering: where would Bitcoin be headed with this absolute mayhem of a situation? - While Bitcoin and the overall crypto market crashed, we did manage to close above $40.7k on the daily. - This would indicate that the overall uptrend remains intact, despite the awful news. Conclusion So many answers still remain unanswered. Where does Tether put its billions? Who issues $30B in AA International Commercial paper, willing to pay anything? Why did Tether stop printing money as soon as Evergrande’s liquidity died? As I've said in the previous post, the best thing we can do as investors is to prepare for all probable situations. In my personal opinion, the Chinese government seems willing to indirectly solve the issue by injecting capital via open market operations, so it's more likely that this situation will be settled at one point, as opposed to leading to the entire global financial market collapsing. If you like this educational post, please make sure to like, and follow for more quality content! If you have any questions or comments, feel free to comment below! :)
HKEX:3333
by Michael_Wang_Official
17
El Salvador BTC adoption storyAuthor Jordan Atkins (Coingeek) 17 June 2021 El Salvador’s move to make BTC legal tender in the country, and will set up a $150 million national trust fund, which will supposedly be used to compensate merchants for the volatility of BTC between accepting payment and depositing it in the bank. This news was received by the BTC community in the same way it receives more or less anything: uncritically, with effusive praise and a complete disinterest in specifics and practicalities. This is unsurprising, but alarming because these specifics and practicalities almost defy belief. Importantly, El Salvador’s currency is the U.S. dollar. Therefore, in order to effect this change, El Salvador partnered with Strike, a mobile app which will supposedly let El Salvadorians living abroad to send money back home, cross-border, for free. Virtually any conversation about currency for El Salvadorian citizens has to start here, because almost a quarter of them live in the United States. Guess how Strike is powered? Using a proprietary version of Blockstream’s Lightning Network. Guess how Strike works? By taking the dollars of the El Salvadorian people wanting to send money back home, using that money to buy BTC, sending those BTC to El Salvador, converting them to Tethers, and then depositing those Tethers into the recipient’s Strike account. It is Tether that El Salvadorian recipients will receive; not any form of Bitcoin. That’s right: while the country’s so-called Bitcoin Law is being celebrated from every corner of the BTC community, it quietly turns out that as with most things in crypto it is Tether, not BTC, that is the real story. We already know that not a single tether has been successfully redeemed, and indeed the tether terms of service explicitly rejects any obligation to accept any such redemption from holders. So if the recipient wants to use what they’ve been sent, they must go to one of the two Bitcoin ATMs currently operating in the country, scan the ATM’s QR code into their Strike app, which will then convert the tethers into BTC and send them to the ATM. The ATM will then dispense the necessary amount in local fiat currency. This sounds ludicrous, but this is exactly the process that Strike founder Jack Mallers described in announcing the app in January. Mallers didn’t describe the scheme as a way to take the valuable fiat of El Salvadorians in exchange for a useless, unbacked token, instead choosing to say that ‘today, the world changes; the fundamentals of value exchange between our species enters a new epoch.’ It’s certainly a new epoch for El Salvador and President Bukele, who can now effectively print money for as long as it takes for El Salvador to realize that their ‘digital dollar’ USDT has even less connection to fiat than BTC does. Author David Gerard has written on the El Salvador Tether scam, both on his own blog and on foreignpolicy.com. As he posits: “Bukele appears to be setting the country up to inject bitcoins into the economy, mark them as ‘dollars’ to make up his deficit, and grab the actual dollars to pay foreign debts.” All that has been achieved in El Salvador’s announcement, then, is that some number of El Salvadorian businesses and citizens have been strapped to the Tether timebomb while being told it’s a rocketship, while those who organized it become fabulously wealthy. The saving grace is that the status quo proposed by President Bukele and the likes of Strike is so ludicrous that it’s almost certain that uptake of BTC will be minimal, although the offering of a so-called ‘alternative’ does open the door to more drastic action down the road: “The tricky part of the bitcoin (BTC) scheme is convincing the Salvadoran public to go along with it, given they often trust U.S. dollars more than they trust the government. Many already see the Bitcoin Law as an attempt to expropriate their dollars—it would be trivial to provide more coercion by raising fees for dollar withdrawals, or restrict the amount that could be withdrawn.”
CRYPTOCAP:USDT
by BizzarTrading
1