The start to this week saw Bitcoin investors, and the market as a whole, shocked as the self-proclaimed stablecoin, Tether dropped 6% below the USD during a growing sense of confusion within the crypto space.
In the early hours of Monday morning, crypto assets seemed to be on the upside and looked strong. However, numbers continued to waste away during the commotion. As users searched on the internet to find out what was the stimulant behind the influx, it became clear that there was something wrong.
Furthermore, Bitcoin had somehow overshadowed the $ 7,200 mark on platforms that all support USDT including Bitfinex, Binance, Kraken and OKEx. However, Bitcoin only jumped a little over the $ 6,700 on non-Tether related platforms.
For months now, Tether has been holding its value of $ 1 but has now dropped 6% below its normal rate. This adds to the theory that the recent drop had something that wasn’t quite right with it.
A market analyst, Alex Kruger commented on the market behaviour. Kruger took to Twitter to have his say on the matter and the begin with he highlighted the price difference between Bitfinex and Coinbase which apparently holds a close rope to the Tether Foundation.
Kruger pointed out that at one point, the price spread between the value of Ethereum on Bitfinex and Coinbase went over 10%. This is essentially unheard of in the current ‘nascent’ crypto markets.
Some wild move on crypto. 10% spread on $ ETH between Bitfinex and Coinbase.
— Alex Krüger (@Crypto_Macro) 15 October 2018
News BTC had commented on the matter saying:
“While USDT is one of the most liquid crypto assets in this market, the order books of the BTC/USDT trading pair couldn’t handle this unprecedented liquidation, resulting in Bitcoin’s unrelenting move above $ 7,000 on Tether-enabled platforms.”
Kruger went on to corroborate his theory saying:
“USDT crashing, 0.94 handle, helping to push all cryptos higher. It would be quite an irony if a Tether collapse would send bitcoin out of this bear market.”