According to researchers, the price of Bitcoin has been manipulated by the Tether

Market manipulators used the Tether USDT token to artificially inflate the price of Bitcoin during the protracted bullish run of 2017. According to a new explosive study of financial transformers from the University of Texas, John Griffin and Amin Shams, best known for have identified the suspicious activity in the VIX last year.

In a 66-page report titled "Is Bitcoin Really Un-Tethered?", Griffin and Shams claim that the Theter, a "stablecoin" allegedly backed by the USD at a ratio of 1: 1, was used repeatedly to support Bitcoin prices during market downturns.

"Overall, we find that the Tether has a significant impact on the cryptocurrency market. It seems to be used both to stabilize and manipulate the prices of Bitcoin, "the researchers wrote. "Less than 1% of hours with such heavy Tether transactions are associated with 50% of the explosive increase in Bitcoin and 64% of other cryptocurrencies. "

Although this correlation may simply be due to the fact that an influx of links indicates an increase in merchants' demand, the researchers say that other data suggest that the Theter can not be fully supported by the USD - at least not all the time.

As proof of this statement, Griffin and Shams note that the month-end pressure on the price of Bitcoin tends to be negative in the months when a large number of links were issued but not in others. This, it is said, may indicate an "end-of-month need for Tether dollar reserves," implying that the Tether issues unsupported chips to help shore up the price of Bitcoin and then sells enough BTC to the end of the month to support the USDT in circulation.

As CCN has reported, Tether has been increasingly monitored as market capitalization of the bond has increased over the last calendar year. Since trading platforms often find it difficult to find the banking partners and achieve the regulatory compliance required to offer fiat-crypto trading pairs, many Altcoins trading platforms use Tether as a proxy for the USD. physical.

The United States Commodity Futures Trading Commission reportedly sent Tether - as well as Bitfinex, with whom it is closely related - a subpoena in December, but it is unclear whether or not this investigation will lead to action.

However, earlier this year, a report from BitMEX Research found that the Tether reserves are probably housed in the Puerto Rico-based Noble Bank. A Bloomberg follow-up survey revealed that Bitfinex and Tether are probably banking with Noble, but neither company has publicly confirmed it.