Tether Accused of Bitcoin Manipulation, According to Economist Peter Schiff

Bittime - Peter Schiff, a well-known economist and critic of Bitcoin, again leveled sharp accusations against Tether, the company issuing the USDT stablecoin, for its recent Bitcoin purchases. 

Schiff accused Tether of market manipulation by printing USDT “out of thin air” to buy Bitcoin. This statement has again sparked debate in the crypto community, especially regarding the transparency and legitimacy of Tether's financial practices.

Allegations of Manipulation in Bitcoin Acquisition 

Tether has just announced the purchase of 7,629 BTC, which brings their total Bitcoin holdings to $7.68 billion (Rp. 124.4 trillion). However, Schiff claims that this move reflects deeper manipulation. 

He likened Tether's printing of USDT to “quantitative easing” carried out without clear asset collateral. Schiff assesses that this strategy could have a negative impact, both for Tether and the Bitcoin ecosystem as a whole.

Schiff also criticized Tether's business model, which he said created USDT without a solid foundation, other than the Bitcoin purchased from the transaction. This criticism reflects broader concerns about whether Tether's reserves are truly sufficient to support all of the USDT circulating in the market.

Negative Sentiment Tether

Schiff's scathing comments strengthened negative sentiment around Tether, especially after speculation emerged about Tether leaving the European Union market due to MiCA (Market in Crypto Assets) regulations.

In the latest developments, USDT market capitalization was recorded to have decreased by $2 billion (Rp. 32.4 trillion). However, Tether CEO, Paolo Ardoino, immediately responded to this. 

Ardoino alleged that Tether's competitors were trying to create an unfounded negative narrative to undermine market confidence. Ardoino also emphasized that Tether and Bitcoin will continue to survive external challenges.

The Importance of Transparency and Audit

To understand this situation more deeply, crypto observers and users are advised to continue monitoring Tether's reserve audit reports and their transparency policies. 

Given Tether's vital role in the global crypto ecosystem, this move is important to ensure stability and market confidence in USDT. 

With increasingly large amounts of Bitcoin in its reserves, Tether is under the spotlight to prove that its operations comply with responsible financial standards.

FAQ 

What is Tether and USDT?

Tether is a USDT stablecoin issuing company. USDT itself is a crypto asset designed to maintain its value stably by referring to certain fiat currencies, such as the US dollar. USDT is the number one and largest stablecoin in the world.

USDT was first launched in 2014 under the name Realcoin before changing its name to Tether. This stablecoin operates on various blockchains, including Ethereum, Tron, and Omni. 

Founder of Tether

Tether was founded by three main individuals: Brock Pierce, Craig Sellars, And Reeve Collins. In October 2023, Polor Ardoino was appointed as the current CEO of Tether.

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Reference

CoinTurk, Peter Schiff Acuses Tether of Manipulating Bitcoin Purchase, accessed January 1, 2025.
BitDegree, What is Cryptocurrency, Accessed January 1, 2025.
CoinGecko, What is USDT Tether, Accessed January 1, 2025.