Is Tether Supply a driver of Bitcoin Prices

[criptoUSDJPYEU]

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

[mobnepal]

Tether has been hacked before  https://www.coindesk.com/tether-claims-30-million-stable-token-stolen-attacker
and what they got as solution is

Representatives from the Omni Core software project said they would seek to release new software in the coming days that will allow Tether to retrieve the stolen tokens.

Tether is actually centralized so they can easily manipulate their supply and even with the help of omni (which acts as token creation platform on top of bitcoin blockchain) they can blacklist/block the stolen tokens from being used. So when it will be hacked like this again than it might not have much effect on market.

The major concern is whether all the tether token that exist have backing or not, third party audit will clear this but still many have concerns over their shady financial activities and their involvement with bitfinex. If they go insolvent or proved to have fractional reserve than it might cause chaos in crypto market.

However, With increasing number of new stablecoin like DAI, TUSD, USDC market might not remain totally relied on USDT in future.

[batang_bitcoin]

You have to close the other thread you've made on Economics. This post. As forum regulations doesn't allow to create same topic on different sections unless you've translated it to your local language.

12. No duplicate posting in multiple boards (except for re-posting it in the local language boards if it's translated).

Please be guided by that rule, lock the other topic you've made that I've pointed out.

[benjamin07]

Only idiots buy and sell BTC/USDT or USDT/BTC, anyone with half the brain of a chicken would not be trading that binary.

[pooya87]

first explain to me why bitcoin price continued falling down for more than a year in 2018 and that was a big drop of nearly 85% while Tether was still around and it was still printing more and more coins and entering it in circulation.
then i will answer your question!

[adaseb]

Think of it this way.

Say the price of Bitcoin is $1000 a coin and you want to sell it for Tether. Your supply of tether would be $1000.

Now say the price of Bitcoin is $10000 a coin and you want to sell it for Tether. Your supply of tether would be $10000.

So you can see why the supply of tether increases in rising markets, its because it needs to increase so enough people who want to sell bitcoin can do so.

Usually when there is a tether print, its bullish for the markets. Usually traders see this and close their shorts because it usually means that alot of fiat entered the market which bought tether and will eventually buy some Cryptos.

[arpon11]

Not really, a big dump of tether into bitcoin was a speculation of what started this bull run due to the news on Tether not being completely backed or partially backed and some backing being of securities.

I think it is a coincidence that some people are saying that the dumps of tether at bitfinex was the reason why bitcoin is getting pump at this moment. We also heard some people saying that libla coins was reason why bitcoin get bullish but I disagree with all this views. We have be in this market for long and we know how it operate, we have one event that keep repeating itself pre bullish price and that is halving. I think the market is reacting to the next year halving of bitcoin. The more it becomes very difficult to get bitcoin through mining the better it is in terms of pricing. Tether has little to do with Bitcoin from market capitalization point of view.

[YuginKadoya]

I don't really think that tether is behind every movement of bitcoin I really think this is just a coincidence that they see that Tether has moved the value of bitcoin but the truth is Bitcoin is really moving rapidly now because of the bull run movement, And not thanks to Tethers involvement Because Tether is a stable coin, It is backed up by USD and not come from bitcoin itself and I don't think that stable as a cryptocurrency.

[leowonderful]

There's even a Twitter account that tracks the amount of Tether and other stablecoins printed and larger transfers of various alts and Bitcoin. The link to the account is as follows, and this account tweets out pretty rapidly after any major transfers make it into the mempools of many blockchains out there AFAIK. https://twitter.com/whale_alert?lang=en

We don't always pump or move significantly when Tether's printed, but there are times when a large printing of Tether precedes a large move up in price for BTC.

[benjamin07]

Think of it this way.

Say the price of Bitcoin is $1000 a coin and you want to sell it for Tether. Your supply of tether would be $1000.

Now say the price of Bitcoin is $10000 a coin and you want to sell it for Tether. Your supply of tether would be $10000.

So you can see why the supply of tether increases in rising markets, its because it needs to increase so enough people who want to sell bitcoin can do so.

Usually when there is a tether print, its bullish for the markets. Usually traders see this and close their shorts because it usually means that alot of fiat entered the market which bought tether and will eventually buy some Cryptos.

That's a great explanation, thank you. However I am very wary of USDT.

[Naida_BR]

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

Tether is not reliable in making speculation.
This is why there are many more other stablecoins created. The supply of tether is not correlated with the Bitcoin price move. However, If a crackdown happens I am interested to see if those fund will be moved to another stablecoin or will be converted into BTC.

[figmentofmyass]

We don't always pump or move significantly when Tether's printed, but there are times when a large printing of Tether precedes a large move up in price for BTC.

so i'm not the only one who noticed.

there's no doubt the bitfinex and tether markets (like binance) have a strong effect on the market. whenever we see a strong bullish reversal, i go and check the tether printer. often times, it's been on. i'm not necessarily saying they are printing it out of thin air but one has to wonder sometimes!

[Febo]

Is Tether Supply a driver of Bitcoin Prices

Tether supply = fiat money that was invested in crypto.     How on earth would that not influence price of Bitcoin? When tether supply will start decreasing and fiat will start going back out of crypto price of Bitcoin will start reducing.  Of course tether is not only way that fiat enters crypto other exchanges then Bitfinex just simply takes it and charge your account, not telling whole world as Bitfinex does who much fiat you gave them.

[mersal]

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

Probably the supply of tether increases when people cashout their profits of crypto currencies into a stable one which doesn't mean that they are driving the prices.

[jseverson]

And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

They got hit with quite a big regulatory mess just before the bull run started:

https://fortune.com/2019/04/25/bitfinex-tether-bitcoin/

That didn't affect Bitcoin prices much, if at all. That doesn't necessarily mean there's no connection though, and I think Tether completely crumbling down would affect the market quite significantly, whether or not there's manipulation behind the scenes.

Only idiots buy and sell BTC/USDT or USDT/BTC, anyone with half the brain of a chicken would not be trading that binary.

As much as I agree, it can't be helped on most non-fiat exchanges. That's their claim to fame in the first place.

[davis196]

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

I've heard this theory back in 2017 and it might be partially true,but I don't believe that Tether has that much influence over bitcoin.The tether supply goes up because all the cryptocurrency prices are going up as well.
More people are trading coins,thus more people are using tether.

[Reid]

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

What will happen to bitcoin in a sudden breakdown of Tether?
It will be a yummy month or maybe a year.

Where do you think this Tether holders will go when they speculate that it is near breakdown?
If it is a sudden and they cannot go out, then it will be a sad day for them.
But when they heal all of those losses. What crypto currency do you think they will trust afterwards? Yeah bitcoin it is.

It will happen though. I am sure of that.

[buwaytress]

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

Very old news/discussion/point. And quite pointless to me, really. If Tether supply drives Bitcoin prices, then will Tether desupply tear down Bitcoin prices? I doubt it. If something were to happen to Tether one day, something really bad, catastrophic, USDT stuck in some bad smart contract, the issuer gone rogue, Bitfinex liquidated, etc... people would just move to some other stablecoin. Gemini, Coinbase, BNB, will all be waiting in the wings to take over business... and then we'll realise Tether really wasn't that big of a deal to Bitcoin.

[benjamin07]

Is Tether Supply a driver of Bitcoin Prices

Tether supply = fiat money that was invested in crypto.     How on earth would that not influence price of Bitcoin? When tether supply will start decreasing and fiat will start going back out of crypto price of Bitcoin will start reducing.  Of course tether is not only way that fiat enters crypto other exchanges then Bitfinex just simply takes it and charge your account, not telling whole world as Bitfinex does who much fiat you gave them.

Febo: do you really deep down believe Tether is not a hoax?

[adaseb]

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

Very old news/discussion/point. And quite pointless to me, really. If Tether supply drives Bitcoin prices, then will Tether desupply tear down Bitcoin prices? I doubt it. If something were to happen to Tether one day, something really bad, catastrophic, USDT stuck in some bad smart contract, the issuer gone rogue, Bitfinex liquidated, etc... people would just move to some other stablecoin. Gemini, Coinbase, BNB, will all be waiting in the wings to take over business... and then we'll realise Tether really wasn't that big of a deal to Bitcoin.

Its not as simple as that. I don't think anything catastrophic will happen with Tether since Tether and Bitfinex are making crazy money, doesn't make sense for them to scam.

However if Tether say did fail for some reason, it would create a domino effect. Why? Because most of the liquidity in alts and BTC on some exchanges isn't against BTC or Fiat, its against Tether. So if Tether was worth zero all those alts would affect the cash and futures markets. It would create a huge negative effect on anything crypto related. So even if you don't hold tether, your net worth in crypto would still go down since BTC and alts would be worth alot less.