20 Dec Is Tether an existential threat to Bitcoin?
As a Bitcoin investor I owe it to myself to continuously evaluate the threats to this assets therefore I follow most closely its harshest critique.
At the top of these threats IMO is the price manipulation arising from issuance of USDT that isn’t reflective of demand. Although this was a hot topic in 2017, given that the supply has doubled (+$10B) in the last three months it seems critical to discuss.
For those curious enough I highly recommend this paper which provides strong empirical evidence of this manipulation. Moreover, it highlights the interconnectivity of USDT amongst exchanges which provides undeniable evidence on the underlying structure for this manipulation to take place.
On the flip side, I guess these nefarious events are intrinsic to any unregulated financial asset which BTC’s past is riddled with. But the billion dollar question is whether this is an existential threat that could lead to demise of this amazing innovation.
Curiosity to hear hear your ideas, especially if you’ve take the time to study it! It’s not a pretty topic but we owe it to our wealth to address is head on.
Ps; my interest in this was initially re-ignited after listening to an interview of Brock Pierce in which his motivations are rather questionable.