Tether gives BTC something to hold on to

And it’s made it clear that it intends to use its realised profits to buy the asset, with an allocation of up to 15 per cent of those monthly gains.

“These Bitcoin shall be considered on top of the minimum reserves assets that 100 per cent back tether tokens,” confirmed a Tether tweet yesterday.

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This announcement comes after Tether, which issues the $US82.8 billion USDT stablecoin, reported $US1.48 billion of net profits in 2023 Q1.

The company, which is owned by a Hong Kong-based firm called iFinex (which also owns one of the oldest crypto exchanges, Bitfinex) also revealed it already had $US1.5 billion in BTC holdings.

“Tether anticipates that the current and future BTC holdings in its reserves will not exceed the Shareholder Capital Cushion and will further strengthen and diversify the reserves,” the firm clarified in a statement, adding that it will be taking self custody of the Bitcoin:

“While it is common practice among many institutional investors to third-party custody their Bitcoin, Tether believes in the philosophy ‘Not your keys, not your Bitcoin’ and takes possession of the private keys associated with all of its Bitcoin holdings.”

Tether chief technology officer Paolo Ardoino explained the logic behind the move in a further lengthy tweet, writing:

“Why does Tether keep excess reserves in the portfolio? While these excess reserves are part of Tether(’s) own shareholder equity, Tether prefers to give priority to ensuring that its stablecoin products as resilient as possible.

“While banks can do fractional reserve, we believe that’s not a viable strategy for a stablecoin, so it’s crucial that Tether keeps an additional cushion to further protect its user base …

“Why Bitcoin and not something else?

“Because Bitcoin is the epitome of a sound and secure monetary system with its decentralised nature and scarcity, Bitcoin is revolutionising the concept of money and challenging traditional finance.

“Bitcoin has defied expectations, shattered boundaries, and provides access to the global financial system to anyone with an internet connection.”

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Top 10 overview

With the overall crypto market cap at $US1.18 trillion at noon Thursday (AEST), up about 0.6 per cent since the same time Wednesday, here’s the state of play among top 10 tokens – according to CoinGecko.

The crypto market (apart from some newly invigorated metaverse tokens) was languishing late Wednesday, but perhaps the Tether news is the rev up it, and Bitcoin more specifically, needed.

It’s simply possible as well, however, that the market is following its usual path behind the US stock markets, which closed in the green overnight (AEST).

As our very own non-fungible Eddy Sunarto notes in his Market Highlights morning roundup …

“Overnight, major indexes Wall Street rose by over 1 per cent as hopes grew the debt ceiling impasse could be resolved by the end of this week.

“JP Morgan boss Jamie Dimon said US government will probably not default, while President Biden was confident there will be no default.”

Bitcoin has now reclaimed the $US27,200 mark – and looks fairly solid there – after dropping to the mid $US26k range overnight. Let’s see if it can hold it this time …

Uppers and downers

Some of the biggest 24-hour gainers and losers at noon Thursday (AEST). Stats based on CoinGecko.com data.

PUMPERS (11-100 market cap position)

• Render (RNDR), (market cap: $US839 million) +16 per cent
• Synthetix (SNX), (mc: $US767 billion) +10.4 per cent
• Axie Infinity (AXS), (mc: $US859 million) +7.3 per cent
• Optimism (OP), (mc: $US605 million) +5.8 per cent
• Aave (AAVE), (mc: $US946 million) +3.8 per cent

PUMPERS (lower, lower caps)

• SCI Coin (SC+), (mc: $US23 million) +1245.9 per cent
• Shardus (ULT), (mc: $US80 million) +42.7 per cent
• Phoenix Global (PHB), (mc: $US38 million) +36.4 per cent
• Turbo (TURBO), (mc: $US49 million) +24.8 per cent
• Bob Token (BOB), (mc: $US44 million) +24.5 per cent

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SLUMPERS (11-100 market cap position)

• Pepe (PEPE), (market cap: $US662 million) -6.6 per cent
• Conflux (CFX), (mc: $US628 million) -5.6 per cent
• Casper Network (CSPR), (mc: $US529 million) -3.6 per cent
• Bitcoin SV (BSV), (mc: $US651 million) -3 per cent
• XRP (XRP), (mc: $US23 billion) -2.9 per cent

SLUMPERS (lower, lower caps)

• Blox (CDT), (market cap: $US125 million) -29 per cent
• Xen (XEN), (mc: $US26 million) -26.4 per cent
• Krypton DAO (KRD), (mc: $US170 million) -16.1 per cent
• Hifi Finance [OLD] (MFT), (mc: $US 25 million) -18.3 per cent
• ArbDoge AI (AIDOGE), (mc: $US48 million) -12.1 per cent

Around the blocks: BitBoy under fire

Some pertinence and randomness that stuck with us on our morning moves through the Crypto Twitterverse.

The massive crypto YouTube influencer BitBoy is copping flak (yet again) on Crypto Twitter for apparently selling all his tokens of the memecoin $BEN.

This comes after the widely followed crypto influencer (1.46 million YouTube subscribers, 1 million on Twitter) indicated that he had no plans to sell the tokens for at least six months.

Let’s see BitBoy’s response to the furore, however …

Guess we’ll have to wait and see how this one plays out. In the meantime, it’s definitely still Buyer Beware season on the memecoin froth.

This content first appeared on stockhead.com.au

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