Red Flag Waved in Tether’s Relationship with Kraken Exchange this summer

Give it a minute, and Tether will be involved in yet another controversy. Intrepid reporters, Matthew Leising, et al., have once again dived deeply into the ongoing USDT mystery. This time, it’s the concept of ‘wash’ trading, where substantial positions basically trade with themselves to pressure an asset’s price.

Between May 1st through June 22nd of the present year, 56,000 USDT orders on Kraken were monitored. For researchers, even massive trades seemed to not impact tether’s price. In fact, larger trades were indistinguishable in this regard from smaller. The sum of 13,076.389 USDT was one exact anomaly, repeating often enough for analysts to conclude something like bots were active on the exchange.Bloomberg recently suggested tether trading red flags. Enlisting former Fed regulator Mark Williams and NYU’s Rosa Abrantes-Metz, Mr. Leising and his collaborators examined USDT activity on Kraken, finding “oddly specific order sizes—many going out to five decimal points, with some repeating frequently.” Trading bots, if that is what this is, are rather par for the course these days, and hardly controversial. It’s USDT’s lack of responsiveness that has this group searching for explanation. Bitcoin core (BTC), again assuming tether inflation as the cause, jerks and pulls seemingly according to tether dumps, which most would term “normal.” Tether lingers, unresponsive.