Bloomberg Article On Tether Spooks Market

  • Bloomberg article reveals Bitfinex and Tether sent subpoenas
  • Lightning nodes grew on the bitcoin main net

Comment of the Day @Bitperplexed:

Bloomberg Article Causes Panic

A Bloomberg article that hit news yesterday is thought to be the cause of the recent bitcoin drop and other crypto-assets. It revealed that Tether and Bitfinex have been sent subpoenas from the CFTC (Commodity Futures Trading Commission) to audit their banking.

Tether is a USD proxy that claims to issue 1 USDT for every 1 USD that it has banked. It is useful for exchanges as it allows customers to hold a cryptocurrency that has similar properties to USD but without the regulatory troubles of banking in the US.

However, these subpoenas were served on December 6th, almost two months ago, and the fact that it is causing such a drop shows signs of a nervous market. With bitcoin struggling to stay above $10,000, could this be the straw that broke the camels' back?

If it does, the value of USDT should drop to refelct the USD held in reserve. If it doesn't, then the escape route for USDT bagholders will be through bitcoin. The question on everyone's minds is whether Tether does indeed have a 1-1 USD reserve as it claims to have. Or if it is operating a fractional reserve system that is similar to say... all fiat money.

It will be interesting to watch the Tether and Bitfinex allegations unfold as it could have a significant impact on the price despite only making up 0.4% of the total crypto-asset market capitalisation. Whether Tether and Bitfinex actually need to respond to the subpoenas is another question:


Lightning Node Count Grows

The speed and enthusiam at which lightning has been adopted is remarkable despite the lack of a non-buggy GUI client. Estimates of the arrival of lightining over the summer of 2017 were mid to late 2018. To see it active on the mainnet is vindication for those that supported the non-hardfork route to scaling. 

Lightning represents a huge milestone in the development of scaling solutions for bitcoin, a topic that has been the center of heated debates over the last three years. It also comes at a time when fees are at 4 months lows after some extremelly high fee periods of over $50 at times.

However, the GUI clients are still buggy and people are losing money as a result of this. Many more months or even years will be needed to test and improve lightning before it is available to the masses in a secure and simple form.


Amun Gets Regulatory Approval to Offer Crypto ETPs to Retail Investors in EU

Switzerland-based fintech firm Amun AG has received regulatory approval to offer its cryptocurrency exchange-traded products (ETPs) in the European Union.

Currently, Amun offers nine cryptocurrency ETPs, including some base on bitcoin (BTC), ether (ETH), XRP, and more, in Switzerland and Germany via the Boerse Stuttgart, BX Swiss, and the SIX stock exchange. Now, the Swedish Financial Supervisory Authority (SFSA) approved its base prospectus to offer investment products tied to cryptocurrencies.

Exchange-traded products are a type of securities that track the price of an underlying asset, index, or another financial instrument. Amun’s cryptocurrency ETPs let investors gain exposure to various top cryptos without having to custody them and manage private keys.

The SFSA’s approval means the fintech firm can offer them not only in Sweden but also across the European Union. It isn’t currently clear on which exchanges in the EU the ETPs will be listed on.

Amun’s president, Ophelia Snyder, said the process took four months of consultancy period, and added:

The combination of strong demand for ETPs in Sweden – especially in crypto assets – among private investors and institutional clients and our strong expertise in these product categories create ideal conditions for Amun’s entry into the Swedish and European Union markets for ETPs

Amun’s press release notes the approval of the base prospectus shouldn’t be seen as an endorsement by the SFSA of the securities being offered, and that potential investors should dig into the prospectus before making decisions.

As CryptoGlobe report, thanks to Amun Switzerland’s SIX stock exchange listed the Amun Tezos ETP, which rewards investors with generated income thanks to the cryptocurrency’s Proof-of-Stake (PoS) consensus algorithm.

Featured image via Pixabay