Recently, the Wall Street Journal reported that US prosecutors and the Treasury Department are investigating Tether, the world’s largest issuer of USDT cryptocurrency stablecoins. The article claims that the US is considering potential sanctions against Tether, alleging a possible threat to the stability of the dollar in the digital market. However, this is not the first incident in which Tether is at the centre of a wave of FUD (Fear, Uncertainty, and Doubt), generating doubts and concerns on a large scale.
For those less familiar with the term: FUD is a well-known strategy in the markets to sow distrust and anxiety among investors. Often, such alarmist news leads to knee-jerk reactions that influence the market and can benefit those who speculate on price fluctuations.
Tether, in particular, has been the subject of numerous waves of FUD in the past, with articles published by the Wall Street Journal itself raising similar doubts without ever leading to concrete results. One example dates back to 2021, when the WSJ leveraged alleged risks associated with Tether’s reserves, but without producing substantial evidence. Today, the pattern seems to be repeating itself, with reports leaving more questions than answers.
In response to the recent news, Paolo Ardoino, CEO of Tether, made a significant move. On stage at PlanB Forum in Lugano, a prestigious international event dedicated to Bitcoin and the world of cryptocurrencies, Ardoino publicly presented Tether’s Treasury, demonstrating the company’s transparency and solidity in front of a high-level audience. Ardoino emphasised how Tether has been a pillar of stability for investors in the crypto sector for years, providing liquidity and security in a market known for its volatility.
JUST IN : Tether CEO confirms their reserves hold a total of 82,454 BTC and 48.3 tons of gold. 💰📈 #Tether #Bitcoin @LuganoPlanB pic.twitter.com/QRCi1hqMO2
– Tran Hung (@spaftu) October 26, 2024
But then, why so much FUD around Tether? Who could be bothered by the presence of such an entrenched stablecoin? With institutional funds entering the crypto market, some of them backed by entities linked to traditional financial circuits, Tether could pose a ‘threat’ to their influence. Indeed, these institutions see the growing adoption of stablecoins as a transfer of economic power towards decentralised and independent models.
Unlike banks, which operate in a centralised and regulated system, Tether has built its ecosystem on blockchain, presenting itself as a viable alternative to traditional finance. This position has ensured it growing popularity among small and medium-sized investors, but it may not be viewed favourably by the new big players that have recently entered the sector. The possibility of generating regulatory pressure could, therefore, favour less competition in the stablecoin field, leaving more room for issuers with institutional ties.
In any case, Tether has always maintained its commitment to providing transparent support to the crypto community. It will be interesting to see developments in the coming days and in view of a highly anticipated bullish market after years of bear market.
