Tether to Issue Commodity Backed Stablecoin, - Dong

Zhao Dong is major investor and shareholder of the Bitfinex
03 September 2019   225

Bitfinex exchange major investor Zhao Dong told Cointelegraph that Tether plans to release a USDT stablecoin option, backed by a basket of commodities such as gold, oil and rubber.

According to an insider, the purpose of issuing such a token is to reduce the risks associated with the need to store large amounts in banks to ensure it. Dong also stressed that the flagship stablecoin USDT is not 100% secured with a fiat dollar:

Tether is fully backed by reserves, out of 4 billion existing USDT about 3.35 billion are now in securities and 650 million are being lent to Bitfinex. Bitfinex has been raising 1 billion with it's LEO token IEO and could easily pay back Tether any time (as a matter of fact it already paid 100 million last month).

Zhao Dong

Shareholder, Bitfinex

Dong is confident that the level of provision with USDT reserves is generally sufficient to consider this stablecoin reliable.

Even if you don't calculate this 650 million as reserves the total amount backed by USD is 83.75% (3,350/4000) and not 72% as fake news are reporting.

Zhao Dong

Shareholder, Bitfinex

 Zhao Dong also remembered Tether’s plans to issue CNHT stablecoin linked to the renminbi and with reserves on offshore accounts.

CNHT will not interfere with PBOC [People’s Bank of China} capital control policy because CNH is different than CNY, as it's already an offshore product. On the contrary CNHT will help China to expand the adoption of CNH for international settlements.

Zhao Dong

Shareholder, Bitfinex

At the end of April, the New York Attorney General's Office charged Bitfinex with the fact that, having suffered a loss of $ 850 million, it withheld this fact, partially using the funds of Tether, the stablecoin issuer affiliated with it, to cover the damage. Later it turned out that these funds were frozen in the bank accounts of the Panamanian processing service Crypto Capital.

318 Wallets to Control 80% of USDT, - Coin Metrics

According to the research, a significant part of these funds is probably used by the exchanges, where USDT is actively used for transactions
08 August 2019   710

About 300 wallets control 80% of the Tether stablecoins, Bloomberg reports, citing a new study by Coin Metrics.

A significant part of these funds is probably placed on the wallets of cryptocurrency exchanges, where USDT is especially actively used for transactions. Major Tether holders also include brokers oriented to work with Chinese investors and high-frequency traders.

Tether Ownership Distribution
Tether Ownership Distribution

The concentration of Tether suggests that control of Tether is in the hands of a few central players who can swing Bitcoin prices, and have a vested interest in doing so. It also suggests that many exchange players have a vested interest in keeping the Tether game going.

John Griffin

Finance professor, University of Texas at Austin

According to Coin Metrics, Tether was used to conclude 40% and 80% of all transactions on the Binance and Huobi cryptocurrency exchanges, respectively. The company’s analysis included USDT-wallets based on the OMNI protocol and the Ethereum blockchain, the balance of which exceeded $ 1 million. 318 such wallets were counted.

On the other hand, according to the BitInforCharts.com portal, currently over 20,000 bitcoin addresses contain cryptocurrencies worth more than $ 1 million. This may be explained by the greater popularity of bitcoin as a means of accumulation, while stablecoins are often not withdrawn by users from exchanges. where they accumulate in large volumes.