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Tether and Bitfinex subpoena causes Bitcoin and other altcoins to tumble

Mohan Pratap

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Bitfinex causes market to burn
Source: Pixabay

Bitcoin fell once again to trade below $10K, majorly attributed to the U.S. Commodity Futures Trading Commission subpoenaing both Tether and Bitfinex. Bitfinex is one the top cryptocurrency exchanges in the world, which sees a monthly traffic of 59 million and accounts for 10% of cryptocurrency transactions worldwide. Analysts believe “Panic-selling” was the major cause of cryptocurrency markets dropping by nearly 15% on an average.

Tether is a cryptocurrency issued on the Bitcoin blockchain through the Omni Layer Protocol backed by 1 US dollar.

So what was the problem?

Both Tether and Bitfinex have the same management and CEO, Jan Ludovicus van der Velde. The two companies were subpoenaed as Tether abandoned its audit.

The management spoke to Bloomberg regarding the allegations and says,

“We routinely receive legal process from law enforcement agents and regulators conducting investigations, It is our policy not to comment on any such requests.”

If at all the agency unearths a scam it will be the biggest in the cryptocurrency world. This will not have a long-lasting impact as tether accounts for less than 1 percent of crypto transactions and users.

Jamie Mathison, a skeptical cryptocurrency journalist from Dublin, says,

“Wow! I can’t believe it if there is an actual scam then a lot of people have been duped. Cryptocurrency cannot be trusted, I feel everything is a scam”

Deepan Valunethan, a Financial Advisor at a reputed firm from Paris, says,

“Bitfinex has been in business for the past many years and have people from all over the world investing through them. If they turn out to be duping people, it is going to create a massive crypto chaos in the industry with markets going down by more than 50% of their value from now”

Carl Singer, a Cryptocurrency Advisor at a Hedge Fund company in Oslo, says,

“Even if this is true and it is a scam, the current market red is because people are withdrawing from that exchange, which means people will use other exchanges and reinvest the same capital. It is just a matter of time and I don’t think the markets need to worry”





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Mohan Pratap is a contributing News writer at AMBCrypto. He is an Engineering graduate with an acute curiosity to unravel Blockchain and technology-related stories. Mohan currently does not hold any value in any cryptocurrency or its projects.

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Bitcoin

Bitcoin will likely be valued at $100,000 with a market cap of over $2 trillion before the end of 2021

Priya

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Bitcoin [BTC] will likely reach $100,000 with a market cap of over $2 trillion before the end of 2021
Source: Unsplash

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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