The USD Tether [USDT] saga continues to unfold along with exchange platform Bitfinex, as fiat deposits to their exchange are becoming increasingly arcane. While this is not an uncommon occurrence for the exchange, the platform has recently come under flak for multiple problems with the supposed ‘stable coin’.
The exchange platform is now banking with the Hong Kong-based Bank of Communications through a private account under the name of PROSPERITY REVENUE MERCHANDISING LIMITED, revealed a source to The Block.
The intermediary bank in the system is Citibank, and it is unclear whether the corporation is aware of the exchange banking with them. This harkens back to 2017, where the exchange had entered into an arrangement with Wells Fargo, which was the correspondent bank for Bitfinex’s banks in Taiwan.
The change comes after HSBC supposedly terminated relations with the exchange platform, as fiat deposits were temporarily paused over the last week. Speculation has since ensued that HSBC terminated the relationship with the platform.
The change has now resulted in a system that Bitfinex claims is “new, improved and increasingly resilient” method for depositing fiat currencies to the exchange. However, attempting to do so will require the user to hold $10000 worth of equities, along with going through an account review which may take up to 48 hours. Following this, the user is then given a deposit notification which specifies the bank details for that transaction.
However, the exchange platform warns its users before engaging in deposits, as seen in a screenshot posted on Twitter by WhalePanda. The warning stated:
“This banking information is commercially sensitive and confidential. You should be very careful with this information. You are asked to keep this information to yourself and to not share it except with your financial institution. Divulging this information could damage not just yourself and Bitfinex, but the entire digital token ecosystem. Accordingly, you are cautioned that there may be serious negative effects associated with this information becoming public.”
Moreover, the exchange platform seems to imply that the downfall of their fiat deposit system comes from their competitors, with their blog post stating:
“We believe this system to be significantly more durable in the face of sustained attacks by our competition and their supporters. Ongoing campaigns against us will only result in our company becoming stronger and better.”
This comes at a time when investor faith in the Tether stable coin is dwindling, with many users calling for a boycott of the coin. However, the coin still remains as the second most traded coin after Bitcoin, thus signaling a catastrophic decline for the market in case of its failure.
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Bitcoin will likely be valued at $100,000 with a market cap of over $2 trillion before the end of 2021
The entire cryptocurrency market seems to be on the brighter side of the market since the beginning of the year. A majority of the coins have recorded significant recoveries from their 2018 slump, a period during which most coins lost over 90 percent of their value, when compared to their all-time highs. Among all the coins in the market, Bitcoin [BTC] aka the digital gold, was noted to be making a massive comeback as the coin breached the $11,000 mark after nearly 15 months. The coin however, soon retracted to settle below the $11,000 level.
According to CoinMarketCap, at press time, Bitcoin was trading at $10,887.27 with a market cap of $93.549 billion. The coin recorded a 24-hour trading volume of $20.757 billion for the past 24 hours and saw a massive rise of over 17 percent over the past seven days.
Anthony Pompliano, Co-founder of Morgan Creek Digital Assets, predicted that the largest digital currency could rise to reach $100,000, before the end of 2021. Pomp added that he was around 70-75 percent confident in this prediction. He stated,
“As I have previously said, making predictions is difficult […] Part of my process as a professional money manager is forming a thesis (price target), identifying a timeline (date), and establishing a confidence level. And then constantly re-evaluating those three aspects of my thought process as I receive new information.”
Pomp however, listed six pointers that have to be understood beforehand. First, this prediction is not an investment advice, and people should do their own research before investing in the digital currency. The second is with respect to Bitcoin’s volatility, with Pomp remarking that since it was a highly volatile market, the coin could witness a significant fall before being valued at $100,000. He stated,
“I anticipate that there will be numerous 20-30% drawdowns from new all-time highs as the asset continues to appreciate in value. These mini-boom/bust cycles should not cause panic, but rather need to be understood as natural market dynamics whenever an asset gains significant value in short periods of time.”
Further, the partner of the investment firm stated that the rise would be driven by several catalysts. This includes institutional adoption, exchange-traded funds and retail product approvals, global instability, governments all across the globe manipulating currencies, markets and economy. He went on to state,
“The market cap of Bitcoin will reach $2+ trillion when Bitcoin is worth $100,000. This is less than 1/3 the market cap of gold and less than 1/40 the global money supply.”
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