Tether Gets (Another) New Bank

Colin Muller

The avalanche of recent news on the Tether (USDT) stablecoin continues today, as the opaque cryptocurrency company has reportedly secured its latest banking relationship with the Nassau-based Deltec Bank.

Unnamed sources speaking to TheBlock said that the relationship was formed only in the last few weeks.

Deltec Bank & Trust Limited provides various financial services, and a Bloomberg article last year stated that the former chief investment officer Atul Lele managed $5 billion for Deltec.

This new banking relationship comes shortly after Tether’s previous arrangement, with Noble Bank of Puerto Rico, was reportedly ended under unknown circumstances. Bloomberg reported that “while Noble faced an audit from Puerto Rico’s main bank regulator last year that raised concerns [...] it hasn’t been faulted publicly”.

Dramatic Times for Tether

Concerns over Tether, along with its sister company and cryptoasset exchange Bitfinex, are suspected to have caused dramatic price movements in the preceding days, especially for cryptoassets trading against Tether, which traded at historic premiums.

Tether and Bitfinex are registered in the British Virgin Islands, and share management and investors. The companies together have a chequered history, largely because Tether has never allowed a legal audit which confirms the existence of U.S. dollars equivalent to printed Tether tokens.

Both companies were previously served by Wells Fargo & Co bank, and both were subpoenaed by the Commodities and Futures Trading Commission, which agency plays a cardinal role in the regulation of cryptoassets in the U.S.

Tether is also finally facing serious competition in the stablecoin space, as a rash of listings of new stablecoins have come in the last couple of days, on the OKEx and Huobi exchanges. Paxos, True USD, Gemini Dollar, and Circle’s USDC will provide more options to the cryptoasset industry for quickly moving dollars.

OKEx Was the Top Crypto Derivatives Exchange in September, Report Shows

Leading cryptocurrency exchange OKEx was the top crypto derivatives exchange in the month of September, trading a total of $90.3 billion in total. Huobi followed suit, trading $84 billion.

According to CryptoCompare’s September 2019 Exchange Review, the crypto trading platform represented 33.7% of the daily derivatives volumes, trading $3.08 billion per day. Behind OKEx was Huobi with $2.82 billion traded a day, followed by BitMEX’s $1.88 billion.

Cryptocurrency exchanges like Deribit and CryptoFacilities, which is FCA-regulated, represented only $334 million and $74 million a day, respectively.

Top derivatives exchangesSource: CryptoCompare Exchange Review

The report notes that the most traded derivatives product by trading volume was BitMEX’s perpetual BTC futures contract, as its total trading volume for the month was of $41.7 billion. Other top traded products were BTC futures contracts expiring on September 27, with Huobi’s contract seeing $23.3 billion traded, while OKEx saw $17.4 billion traded.

OKEx’s lead when it comes to cryptocurrency derivatives was likely derived by its offering. The cryptocurrency exchange has various futures contracts being offered on its website – not just for BTC but for other top cryptocurrencies like BCH, BSV, EOS, XRP, and TRX.

Similarly the cryptocurrency exchange, which earlier this year announced it’s working on developing global compliance standards for cryptocurrency exchanges through a Self-Regulated Organization (SRO), offers perpetual swaps for these cryptos.

As CryptoGlobe reported, CryptoCompare’s report for August found similar results when it came to OKEx. Despite a market-wide drop in terms of derivatives trading volumes, the cryptocurrency exchange managed to capture over one-third of the market in August.

CryptoCompare’s September 2019 Exchange Review also found that lower-rated cryptocurrency exchanges – according to its Exchange Benchmark Ratings – have been gaining market share in terms of spot volumes.

Per the report, exchanges with an “E” rating represented a total trading volume of $179 billion in September, after seeing an increase of over 30% from the prior month. Exchanges like OKEx, which is A-rated, represented a smaller piece of the pie, with only 14.3% of the market share.