TL;DR
- Peter Brandt warns that Tether (USDT) is heading towards an imminent disaster, years later followed by the eventual collapse of the US dollar (USD).
- Consumers’ Research intensifies criticism against the USDT issuer, accusing it of suspicious business practices and refusal to undergo independent audits.
- According to Consumers’ Research, they have misled the market about the backing of their assets in US dollars.
Veteran trader and market expert Peter Brandt has issued a strong warning about the future of Tether (USDT), one of the most popular stablecoins in the crypto market. Brandt has indicated that USDT is on its way to an imminent disaster, a situation which, according to him, will precede the eventual collapse of the US dollar (USD), although the latter will occur many years later.
His concern is not an isolated case, as it aligns with the criticisms raised by the non-profit organization Consumers’ Research. The entity has intensified its efforts against the issuer of USDT, criticizing the existence of suspicious business practices and the company’s persistent refusal to undergo independent audits for over a decade. In a recent campaign, Consumers’ Research placed a digital billboard in Times Square, New York, labeling the company with the phrase “Tether to corruption.”
Interesting perspective. My contention for years is that Tether is headed eventually for disaster. I agree with this all. The $USD will eventually meet its demise, but years after the same is experienced by Tether https://t.co/04PiPbMDan
— Peter Brandt (@PeterLBrandt) June 19, 2024
Is Tether Misleading the Market?
The CEO of Consumers’ Research, Will Hild, has expressed his concern about Tether’s operations. According to Hild, the company has misled the market about the backing of its assets in US dollars, receiving a high-risk rating of 4/5 from S&P. Additionally, he has pointed out the routine use of USDT by terrorists and drug and human traffickers, raising doubts about the legitimacy of the stablecoin.
Despite the accusations and negative campaign, Tether continues to maintain its peg to the US dollar. However, the history of stablecoins suggests that this period of calm could be temporary. Previous examples, such as the de-pegging of LUNA/UST and the incident with Circle’s USD Coin (USDC) in March 2023 due to its $3.3 billion exposure to the failed Silicon Valley Bank, serve as reminders of the volatility these digital assets can face in adverse times.
As investigations and campaigns against it progress, only time will tell if Tether will manage to maintain its stability or if it will follow the path of other stablecoins that have lost their peg after becoming embroiled in controversial situations. Meanwhile, market users and investors must remain vigilant and be prepared for potential fluctuations.
