The FTX exchange liquidity crisis impacted the business of USDT stablecoin significantly & created a new fear among the crypto Investors for a new big downfall.
USDT is a first-ranked stablecoin, in terms of circulation & use in the crypto industry. Tether is a back-end company behind USDT & it is a subsidiary of the Bitfinex crypto exchange. Tether was the first company in the crypto space, which introduced the concept of a stablecoin to allow crypto investors to move funds easily from one exchange to another without any need for third-party companies.
On 10 November, the USDT stablecoin faced huge panic in the current down crypto cycle. The pegged value of each USDT plunged by 1.8% (from $1 to $0.982).
At the time of writing this article, the current pegged value behind each USDT is $0.9928, which is 0.61% down over what it promises to remain stable.
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Crypto analytic platform Glassnode reported that USDT mean transaction volume reached a 4-month high of 48,947.833 USDT.
$USDT Mean Transaction Volume (7d MA) just reached a 4-month high of 48,947.833 USDT
View metric:https://t.co/gzMa2uBAMt pic.twitter.com/WwRbPa0RD6
— glassnode alerts (@glassnodealerts) November 10, 2022
On this depeg in value & panic among USDT users, a representative of Tether firm said that USDT is not depending on FTX or Alameda and also confirmed that USDT is fully backed by reserved funds.
“We would like to confirm that at this time, Tether has no credit towards FTX or Alameda Research,” the external representative said. “Tether tokens are 100% backed by our reserves, and the assets that are backing the reserves exceed the liabilities,” a Tether representative told via an email
Earlier this, USDT faced depeg in its value by approximately 5% during the Terra (Lunc) collapse, in May of this year, but easily regained value to $1.
Read also: FTX CEO Says without fresh funds, FTX can’t survive
USDT Slips From $1 Peg value amid FTX liquidity crisis
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