The Currency Analytics
By Maheen Hernandez
Tether (USDT) – The most important Stablecoin
Tether (USDT) – Market Makers Using Difference to Make Money
Paolo Ardoino, CTO of Tether during the CryptoCompare Digital Asset Summit took back to the company’s history.
Paolo Ardoino clarifies that the story is his “Point of View” in terms of how he looks at the innovation and the technology.
Paolo spoke about how there are already plenty of stable coins now. He recalled on how some stable coins are asset backed fully and how some are fully cash backed and some…
He calls Tether as the most important stable coin.
He spoke about the journey of Tether with reference to the 2013 – 2014 cryptocurrency ecosystem.
There was slow and limited arbitrage opportunity resulting in widely inefficient markets. The arbitrage mainly relied on bank wires.
Sydney Ifergan, the crypto expert tweeted: “Tether USDT facilitating the advantage of arbitrage to users.
He recalled how there were mild price differences between exchanges. And, how there were market makers who were trying to use the difference to make money.
To close the price discrepancy it was important to send wires around. For instance, he said if Bitfinex price was 10% higher, then it was necessary to send the Bitcoin to…
If the cash is fiat it needs to be moved off the wires and that was painful. He recalled how it can take from one to five days and have a lot of banking frictions.
At some point in late 2013, the Bitcoin price went above $1000 for the first time and there were exchanges that were giving pretty huge different prices.