Long-standing doubts about the popular altcoin and stablecoin Tether (USDT) are reigniting. Experienced trader and well-known market expert Peter Brandt accused the company behind Tether of corruption, while suggesting that it could be the next FTX case. Here are the details…
Analyst Brandt made a statement about the popular altcoin and stablecoin USDT
Amid corruption accusations against the issuer of Tether (USDT) and growing questions about whether it will be the next FTX, veteran trader and renowned market expert Peter Brandt shared his opinion that the popular stablecoin may be heading for disaster. Brandt’s concerns echo those of Consumers’ Research, a nonprofit organization dedicated to protecting consumers. The Consumer Watchdog Organization launched a campaign targeting Tether in early June, claiming that USDT poses a risk to consumers.
In a post published on June 19, Brandt stated that he had been arguing for years that Tether was “eventually heading towards a disaster” and that the US dollar would “end up” years after Tether. “Tether is tied to corruption,” the Consumer Watchdog Corporation posted on a giant digital billboard in New York’s Times Square. Wild Hild, the CEO of the organization, pointed out suspicious connections between Tether and FTX in the press release. Hilde said:
We shine a light on questionable business practices, such as Tether’s decade-long refusal to have independent audits and its product’s routine use by terrorists and human/drug traffickers. Given these warning signs, we’re concerned about the possibility of Tether becoming the next FTX. Consumers should be suspicious of any stablecoin that refuses to properly certify their holdings.
Brandt: ‘There should be no Tether in the future’
More recently, a report by the Consumer Watchdog Organization, which was also the subject of Brandt’s post, stated that “the future may belong to stablecoins, but it should not include Tether.” The report also included accusations such as Tether “misleading the market about US dollar support, receiving a 4/5 high risk rating from S&P, and refusing to undergo a strict independent financial audit.” Despite all these claims and a million-dollar campaign by the Consumer Protection Organization, Tether has so far managed to remain tied to the US dollar. However, it should not be forgotten that stablecoins have faced similar crises in the past.
For example, as Kriptokoin.com reported, the collapse of the algorithmic stablecoin LUNA/UST plunged the cryptocurrency market into a long-term recession. At the same time, Circle’s USD Coin (USDC) also lost value due to its $3.3 billion exposure to Silicon Valley Bank (SVB), which failed in March 2023. As a result, savvy investors and consumer protection organizations are raising questions about the future of Tether and USDT. It is critical for Tether to respond to the allegations and act transparently in order to regain investors’ trust. Additionally, the future of the stablecoin market may require regulators to take a more active role.
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