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Bitmex on Tether

Bitmex Research has released a report on Tether speculating on the likelihood of it being backed by sufficient fiat reserves. However, nobody really knows as a full public audit has ever been provided. Exchanges like Bitfinex, who have been served a subpoena for their financial involvement, have shown a lack of transparency and reluctance to justify any insolvency claims.

The problem is this is not just another random token being traded but pegged 1:1 with the US dollar on the Bitcoin and Ethereum blockchains. Many traders on exchanges and trading platforms assume they’re trading BTC/USD (fiat) but aren’t as they’re actually trading BTC/USDT (Tether) instead. If Tether goes down they’ll go down with it.

Did you know USD and USDT are completely different? Will a Tether collapse cause another Mt Gox or will it simply burn newbie traders?

Disclaimer: CoinCompass isn’t a financial adviser nor a money transmitter and will never provide investment advice. Do your own financial research of what and when to buy.

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