- Tether’s CTO raised concerns about USDT exposure to FTT
- USDT daily volume is peaking
Members of the crypto community questioned prominent stablecoin companies about their participation FTX and FTT. Perhaps, out of concern about a repeat of the Tira scenario. Paolo Arduino, Chief Technology Officer at RopeHe was recently asked about the potential risks of cryptocurrency by FTT as well.
So, how serious is USDT’s exposure to this shortage of assets and businesses?
Do you offer USDT?
Questions regarding the weakness of the stablecoin against FTX and FTT were raised in the file tweet Addressed to Tether’s Chief Executive Officer and CEO of Circle. According to the tweet, Alameda, a trading company of FTX, is rumored to be the largest issuer of USDT.
If the USDT, the largest stablecoin by market cap, suffers a sudden and unexpected crash due to overexposure, the repercussions could be catastrophic. Maybe overtake those from the Terra crash.
Circle and Tether should disclose more of their financial relationship with FTX Alameda to let users know if they are a risk. Tweet embed Tweet embed We see many assets moving from Circle to FTX; There are also reports that Alameda is the second largest tether issuer.
– Wu Blockchain November 9, 2022
After community members voiced concerns, Tether Chief Technology Officer Paolo Arduino chirp The stablecoin issuer is not affected by either FTX or Alameda.
The Tether CEO said that Alameda has redeemed a significant amount of USDT in the past. Despite this, the credit risk did not reach the maturity date.
To be clear: #Rope They have no exposure to FTX or Alameda. 0. Zero.
Maybe it’s time to look elsewhere.
sorry guys. Try again. https://t.co/1bRNUGrttr
– Paoloardoino 🍐 (@paoloardoino) November 9, 2022
Likewise, Jeremy Allaire, CEO of Circle refute Speculation that his company is vulnerable to FTX or Alameda. According to him, although FTX and Alameda were Circle Customers, the stablecoin has not issued loans to FTX, received FTT as collateral, or taken any property in FTT.
2/ The circuit has no physical exposure to FTX and Alameda. FTX has been a customer of Circle Payment APIs for the past 18 months, providing card and ACH services for customer transactions. The beta crypto payment product from Circle FTX and other exchanges uses BTC/ETH liquidity.
– Jeremy Allaire November 9, 2022
USDT Volume Peaks
While doubts and rumors have been eliminated, for the time being, the actual situation of Rope It will remain unknown until the dust settles. USDT remains the most popular stablecoin in the market globally. In fact, the data too show up The trading volume has increased by more than 70% in the last 24 hours.
More information can be obtained from the daily USDT chart.
It was evident that USDT was trading high, as well as a lot of buying pressure, as measured by the volume indicator.
In other news, the CEO of Binance most dangerous The exchange will soon launch a Proof of Reserves audit mechanism to enable verification of its digital asset holdings. This is in the wake of the liquidity issue and the acquisition of FTX.
Is also It promised to develop a Proof of Reserve mechanism using Merkle Trees – a data structure designed to encapsulate blockchain data more efficiently and securely to ensure “full transparency.”
All cryptocurrency exchanges must demonstrate Merkle Tree Reserves.
Banks operate on fractions.
Cryptocurrency exchange should not.Binance He will start doing Proof of Reserves soon. Complete transparency.
– CZ 🔶 Binance (cz_binance) November 8, 2022
Many other exchanges also showed their willingness to follow suit. This is crucial because it will enable people to understand the financial situation of different markets.