Teter CTO confirms hedge funds are trying to lower USDT
Tether CTO Paolo Ardoino said today that various cryptocurrency companies have tried to reduce its stablecoin.
Also today, Genesis Global Trading acknowledged that its hedge fund client has shortlisted Tether through its services.
Tether seems to have met the challenge: the USDT is worth US 1.00 against the US dollar.
Tether’s CTO, Paolo Ardoino, confirmed today that hedge funds are trying to devalue USDT stablecoin.
The CTO says it failed to reduce funding
Ardoino wrote on June 27 to Short Tether (USDT) that he was “open about the efforts of some hedge funds.”
He explained that those hedge funds tried to achieve their goals by using sustainable contracts, selling less in the spot market and creating imbalances in the DeFi pool.
If those efforts were successful, Ardino says, those hedge funds would have created billions of dollars in pressure before the USDT returned at a lower price.
Failing to destabilize the teethers, Ardino says those institutions will have to buy back the teethers they bought at a fair value of ना 1.00 a coin or face bankruptcy.
Ardoino argued that this month’s liquidity crisis shows that lenders and hedge funds are “taking risks that Tether has not touched the ten-foot pole.” Although Ardoino did not name any company, Celsius and Three Arrows Capital are facing bankruptcy due to unrelated high-risk investment policies.
In contrast, Tether has successfully redeemed the full value of 16 billion USDT in more than a month, Ardino said.
Genesis says client shorted tether
With news of tether shorting coming from various sources in recent months, the Wall Street Journal today published an explicit entry from a firm.
Leon Marshall, head of institutional sales at Genesis Global Trading, claims that traditional hedge funds reduced Tether through their brokerage. He said the trades concerned were worth “hundreds of millions” of dollars.
He added that US- and Europe-based hedge funds typically look for small tether opportunities, while Asian cryptocurrency companies offer the other side of the deal.
It is not clear why the firm chose to reduce Stablecoin. Marshall suggests that shorting teethers provide a way to bet against the wider economy and rising inflation. In addition, Marshall says USDT banking concerns are encouraging investors to reduce assets.
Tether, meanwhile, says those concerns are based on misinformation. Today, Ardoino denied rumors of Tether’s inadequate support, the display of Chinese business papers and the display of the default firm Evergrande.
All those rumors have been denied by Tether in the past. Still, uncertainty about stablecoin, well-established or not, has encouraged hedge funds to take risks.
Despite constant controversy, the USDT is currently trading at 00 1.00, equivalent to the US dollar.