A key source of liquidity for exchanges and crypto traders worldwide, Tether is the largest stablecoin in the market. USDT’s market cap has been growing by leaps and bounds since the start of 2020.
And in recent months, it has seen a significant increase in its market cap, which is, in part, said to be helping fuel Bitcoin’s ongoing rise.
As of September, Tether’s market cap had grown nearly 4x since 2020, rising above $15 billion from a starting point close to $4 billion. It’s 24-hour trading volume currently sits at around $28 million.
Data analytics and trade execution services provider Skew was one of many to note Tether’s ascendence.
USDT market cap $18bln pic.twitter.com/uuQkgw2513
— skew (@skewdotcom) November 16, 2020
Enter the Critics
However, not everyone is happy about Tether and its recent growth. A few days before USDT crossed $18 billion, financial analyst and self-described contrarian investor CryptoWhale, tweeted,
“Tether is pushing the prices up. Not billionaires, not institutions, not some weird rainbow S2F model. The huge lawsuits will eventually come to an end, and you will all see what a real rug pull looks like.“
Alleging such a comprehensive level of market manipulation is not unheard of in crypto but unlikely to be a welcome opinion as it runs counter to many widely accepted narratives.
As CryptoWhale themself concluded,
“it means the market is fully manipulated, and not derived from real demand. Of course, no one will talk about it.”
In 2019, a class-action lawsuit was filed against the operators of Tether and the Bitfinex exchange. The lawsuit accuses the groups of managing a sophisticated scheme to defraud investors, manipulate markets, and conceal illicit proceeds.
The case is still pending, but lawyers for Tether filed a motion to dismiss in September, citing, among other things, the claim that plaintiffs have not demonstratively shown that cryptocurrency prices were artificially inflated.