The market cap of Tether is growing at a record pace, and it has increased by nearly 4 times since the beginning of this year. The current data indicates that the market cap is close to $19 billion, which means that there are about 19 billion USDT that are circulating at a price of $1.00 in the market. Given the current trends, Tether has the fourth-largest market cap for any cryptocurrency in the world.
USDT offers fiat onramps to crypto markets
The stablecoins offer a platform to easily redeem the digital assets once they are sold in the markets. In this way, investors can easily convert them to their local fiat currency and make good use of the profits. According to the company, the good thing about USDT is that they are completely supported by real US dollar reserves. However, market analysts are not able to verify this fact as the company has never provided a complete audit of concerned bank accounts in all these years.
According to a report from Globenewswire.com that came in 2019, Tether’s USDT was not entirely supported by the dollar, and it was only backed up to 74% in cash for the current circulating supply in the market. On the other hand, the rest were backed by short-term securities. Tether is related to Bitfinex, which is one of the largest crypto exchanges in the world as both of them are backed by the same management.
Allegations against Tether and Bitfinex
There were some allegations against Tether and Bitfinex in 2017 that they were involved in manipulating the bull market in 2017. However, nothing much came out of these allegations as it is difficult to prove such activities in a decentralized crypto market. The complex nature of the market makes it difficult to manipulate in the first place. Even if some manipulation has happened, it becomes difficult to prove them as analyzing all the private transactions is not an easy task. There is no designated agency to do all these activities.
Tether has remained a dominant stablecoin in the market, and it now accounts for close to three-quarters of the stablecoin market cap. However, as competition is increasing in the market, new players are expected to enter the markets in the future. The hurdles for cryptocurrency transactions need to be cleared by the governments in order to invite more players into the stablecoin and crypto industry. This will make it more transparent and provide more options for users.