European crypto fund founder calls Tether $118 billion scam
- Cyber Capital founder critiques Tether, calls the stablecoin a $118 billion scam bigger than FTX and Bernie Madoff.
- The executive gives an insight into the governance of Tether and notes the disclosures following recent investment in Adecoagro.
- USDT holds steady, maintains its $1 peg on Sunday.
Founder of Cyber Capital, Europe’s oldest crypto fund, criticized Tether for their reserves and said there has been no audit since 2021. In a tweet thread on X, Justin Bons supports his stance on the stablecoin firm with statistics.
USDT held steady at 1USD per token.
Cyber Capital founder calls out Tether for audits and proof of reserves
Tether, the largest stablecoin issuer faced criticism from Justin Bons, founder of Cyber Capital, one of Europe’s oldest crypto funds. Bons labels Tether a “118 billion dollar scam, bigger than FTX & Bernie Madoff combined!”
Bons says there has been no proof of reserves or audit and the stablecoin firm is “printing counterfeit money.”
1/17) Tether is a 118 billion dollar scam; bigger than FTX & Bernie Madoff combined!
— Justin Bons (@Justin_Bons) September 14, 2024
No proof of reserves & an audit has never been done; USDT is printing counterfeit money (fraud)
Caught falsifying documents, obscuring identities & lying about reserves
Stop using USDT now!
Advocacy firm slams Tether, criticizes USDT issuer
Consumers’ Research, an advocacy organization recently raised concerns on Tether and slammed the stablecoin issuer for exposing USDT users to significant risks, owing to their business model.
Even as these concerns surface, Tether continues to serve as fiat on/off ramp for users across most crypto exchanges worldwide. The USDT issuer has emerged as one of the most profitable firms.
Tether reported $12.72 billion in net profit since Q4 2022. This marks a higher profit than asset management giant BlackRock.
FXStreet reached out to Tether for comments, watch this space for updates.
Bitcoin, altcoins, stablecoins FAQs
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.
Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.
Bitcoin dominance is the ratio of Bitcoin's market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.
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