What would the Bitfinex court law mean to the Price of Bitcoin?
On April 25th 2019, it appears that the The New York Attorney General’s office has released a court order against iFinex, the company behind Bitfinex exchange and issuer of Tether, alleging them to have covered up $850 Million Loss using Tether Funds.
Under the court order, iFinex directors, officers, principals, agents, employees, contractors, assignees or any other affiliated individuals are to cease accessing, loaning or making any other claim to the dollar reserves held by Tether.
You seen the flash?
Just hours after the news enters the crypto zeitgeist, the market was quick to react.
The price of Tether also dipped slightly during the same period. Suggesting high sell pressure, which quickly gets abated as the price goes back to peg.
While Bitfinex has issued a statement regarding the court orders. It remains to be seen what events will ensue in the following days and weeks. However, with 60.7% of all Bitcoin trades happening against Tether, such an allegation (regardless if true or false) levied from a State Attorney General will surely impact people's perception towards the exchange and the stablecoin.
Bitcoin has just recently climbed back up to $5000 from the pits of crypto-winter. This is about the worse time for such a scandal to rear its ugly head.
If anything is to happen to Tether, it will cause a rough ride for the market. But at the end of the day, I think it might be a good thing for the entire market. Money will flow to other stable coins, and maybe even to Bitcoin
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@coingecko, thank you for the update! It was really interesting to read your view about the yesterday's sell-off.
Thanks for sharing this news @coingecko, it puts things in perspective.
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The Bitfinex news was no doubt a big one
I think there are now better stablecoin alternatives than USDT. It’s just that tether has been around the longest so it has the highest supply and greatest diapersion. As GUSD, USDC, TUSD, PAX, DAI, etc. all get printed more and more, used more and more, we’ll see a more healthy cryptoverse.
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competition always breeds innovation.
Tether being exposed like this will help crypto in the long run
@coingecko,
If there is another $100 million USD transaction in May, Bitcoin will continue to trend up over the long run, and it would likely be Russian Oligarchs who are buying in.
Check the $100 million USD transaction that happened on the first of April and compare it to the rumor issued by a Russian economist in the beginning of 2018.. he predicted that Russia would start buying Bitcoin in April.
~ @chrisrice
@chrisrice, I live in Russia. What do you mean exactly?
I am an expat who has lived in a foreign country since 2009, and I think living in a country outside of my home country gives me unique insight into the propoganda of my home country.
If you have lived in Russia all your life you'd likely have biases in favor of the mainstream media from Russia @cryptospa and that's why I asked.
Having said that, I am enjoying some of the posts by @rt-international but I understand that every country and every person has biases.
I try not to get too trapped up in biases but I think there are some elite Russian citizens who have ammased wealth from their connections in the Russian Government - a lot of their wealth is probably also from legit businesses but I believe they have an edge over the common Russian due to their wealth and insight into current and future Government policies.
There was a rumor by a Russian economist in the beginning of this year that said Russia would start buying $100 million USD in Bitcoin starting in April.
We don't know if it was really a Russian buyer but someone bought $100 million Bitcoin on April 1. If it happens again in May, I'd be inclined to think it was a Russian buyer or a super big investor who is making it appear that the Russian Gov. or Oligarchs are buying in.
Google the story for more information...
Are you a foreign expat who moved there in your mid-20's (or older) or were you born and raised in Russia?
Btw, thank you for your kindness @cryptospa.. I consider your reply a kind one 😊✌️👍
@cryptospa . . .
https://dailyhodl.com/2019/01/08/russia-will-buy-10-billion-in-bitcoin-ditch-us-dollar-and-become-a-huge-crypto-whale-russian-economist/
From what I've read about Tether, they are speculated to being the reason BTC spiked in 2017 to nearly 20k. If tether is found to be a fraud and discovered they artificially caused BTC to jump to 20k, you can kiss all your profits goodbye. BTC will drop back down to $400 or lower.
We have a Gecko or 2 among who would gladly pickup some bitcoins at that price. sounds like a sweet deal!
It may actually bring more demand to bitcoin as it could be the reserve cryptocurrency for exchange pairing if Tether looses market share due to distrust. Altcoins may suffer though in the short term.
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Bad News for Tether and Bitfinex, but that Scam has been known for quite some time for people who paid attention to it. Yes, the Market will need to adjust to the new fact that Tether will likely fail and will tear down Bitfinex as well. The lost of confidence, volume, liquidity and trust in the market will lead to a further sell out.
When all the dust settles than I think the outcome for the whole cryptocurrency market is much better in the long term without Tether and Bitfinex.
My next guess on this list is Ripple XRP the market will adjust to this flawed system as well.