Betting on the fall of Tether (USDT): a new trend among hedge funds that amuses the stablecoin giant

USDT stronger than expected? – From the day after the crash of theUST On Land (LUNA) beginning of May 2022 is the stablecoin USDT from Bind that has suffered bearish attacks. Despite these manipulative attempts, the USDT is remained indexed on the US dollar. The issuing company recently explained why it believes this hedge fund (hedge fund) to the maneuver have no chance to reach their end.

These hedge funds are “incredibly uninformed” about Cryptos

The downward manipulation attempts prices ofUSDT they were like that flagrantthat the representatives of the issuing company, Bind, have publicly denounced them. Unfortunately for these hostile speculators, nothing went as they hoped.

In a blog post published on July 28, Tether explains why hedge funds lose money trying in vain to shorter (short) the USDT stablecoin. Still, these speculators have failed. For the past couple of months, Tether has been saying yes honored $ 14 billion convert USDT to US currency without fail.

The hedge fund rushed into the cryptosphere, and in particular the USDT, after the disaster of TerraUSD (FSO) in May. They multiplied the short selling to eliminate as many cryptocurrencies as possible. These sales consist of taking some kind ofborrow against an asset to sell it immediately, hoping then to be able to do so buy back cheaper after causing its decline, however repay the loan initial and pocket the difference.

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A condemned USDT demolition business

But obviously for these speculators, destroying a stablecoin based on foreign exchange reserves since USDT is much more complicated than for a algorithmic stablecoin like the MTS of Terra.

What makes Tether say traditional finance has hell “Knowledge gap” of the cryptocurrency market relative to the regulars of this new asset class. Hedge funds that use the event around the FSO to attack the USDT are “Incredibly uninformed” And “completely wrong”.

Also, these short sales come to an end ruin They hedge fund. In fact, they pay the equivalent of a borrowing rate USDT as long as their sell positions are open (and therefore the USDT is not repaid to lenders). However, it’s been more than two months than some wait that Tether’s stablecoin goes down, to no avail.

This “fundamental misunderstanding” cryptocurrency market and USDT will therefore come at a cost to those who try shorter the stable currency. However, Tether has to regularly fight the rumors. Even very recently, the company has had to do this refute rumors of its possession of Chinese commercial titlesit should support its stablecoin.

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