Tether, a giant in the stablecoin sector, has once again caused a stir by conducting a massive issuance, pumping more than $5 billion into the market in just 72 hours.
This sudden growth surge has not only attracted the attention of the cryptocurrency community but has also raised concerns in the financial world, particularly when considering Tether's important role in providing liquidity to the market.
One of the central figures in this event is Howard Lutnick, CEO of financial services firm Cantor Fitzgerald and a significant influence in Donald Trump's power transition team.
In recent months, Lutnick has publicly defended Tether's financial stability, a view coinciding with Trump's nomination of Lutnick as a candidate for Secretary of Commerce.
These developments occur amidst ongoing investigations. The U.S. Attorney's Office for the Southern District of New York is looking into suspicious activities of Tether, including suspicions of terrorist financing.
At the same time, Cantor Fitzgerald has become an important banking partner for Tether, particularly as many global banks have decided to withdraw from cooperating with this stablecoin issuer.
Tether and its influence on the market
Data from the blockchain analytics platform SpotOnChain shows that Tether has implemented a series of stablecoin issuance strategies. On November 6, the company issued $1 billion, coinciding with Bitcoin's strong rally to a record high of $76,200.
Subsequently, on November 9 and 10, Tether issued an additional $2 billion, helping Bitcoin surpass the $80,000 mark. A final issuance of $2 billion brought the total issuance over five days to $5 billion.
As a result, Tether's market capitalization has risen to approximately $132.7 billion, solidifying its position as the largest stablecoin in the cryptocurrency ecosystem.
Lutnick and the conflicts of opinion
Lutnick's role in Tether's operations has become increasingly complex and controversial. While publicly defending Tether's reserves and claiming to have reviewed some of the company's balance sheet, Lutnick has not provided any public evidence of these reserves.
Cantor Fitzgerald currently owns 5% of Tether, valued at approximately $600 million, according to the Wall Street Journal. This investment could create a political advantage for the company, especially as the Trump administration is about to take power.
Divergent views on the relationship between Lutnick and Tether
Harshit Gangwar, marketing director and investor relations of Transak, believes that Lutnick's involvement in Tether's operations highlights the company's collaborative strategy with trusted financial partners in managing reserves.
However, Abdul Rafay Gadit, CEO and co-founder of social investment platform Zignaly, believes that Lutnick's defense of Tether has created a paradoxical situation for regulators as they need to maintain fairness. According to him, it is essential for Tether to be more public and transparent about its reserves to ensure trust within the community and comply with regulatory requirements.
Concerns about Tether's backing
In September, Cyber Capital founder Justin Bons expressed concern that Tether could be a larger scam than FTX.
Earlier, in 2021, the U.S. Commodity Futures Trading Commission (CFTC) fined Tether $41 million for misleading information regarding USDT's backing. In the same year, Bitfinex agreed to a payment of $18.5 million to settle allegations of financial misconduct related to Tether.
Nevertheless, Tether's influence in the market continues to grow, with Tether's stablecoin market share accounting for over 75% of the entire stablecoin ecosystem, a 20% increase over the past two years.
Need more oversight?
On September 8, Tether made a strategic move by investing $100 million in Adecoagro, a major agricultural company in Latin America, acquiring a 9.8% stake in the company. This is the first time Tether has publicly expressed its governance and investment strategy.
However, this move has drawn criticism from industry experts regarding Tether's transparency and governance issues, especially as the company maintains a high level of secrecy in disclosing information about its financial activities.
Source: https://tapchibitcoin.io/tether-phat-hanh-5-ty-usd-va-moi-quan-he-chinh-tri-gay-nghi-ngo.html