Tether Moves To Quell Fears Of Nervous Investors, Still Below $1br>
Tether moved quickly today to assuage nervous investors on the value of its USD-pegged digital coin, which dropped below $1 in value yesterday, an ominous sign.
“We would like to reiterate that although markets have shown temporary fluctuations in price, all USDT in circulation are sufficiently backed by U.S. dollars (USD) and that assets have always exceeded liabilities,” the company said in a statement.
Tether is up slightly in early trading today, but still below $1 after going as low as $0.85 on Monday.
The firm that runs the digital currency, Tether, Ltd., has endured questions on whether or not it holds enough “reserves” to match the amount of tokens in circulation. The company has always claimed that it does. Moreover, a report indicated that Tether was used to manipulate the price of bitcoin, as one whale bought bitcoin using Tether.
Mati Greenspan, senior market analyst at eToro, told CNBC that if Tether’s ability to hold a stable value continues to be called into question, “traders who are holding USDT are most likely to shift their funds into other cryptos in order to hold their value.”