Joe Lubin Believes Bitfinex and Tether Situation Won’t Get Any Better From Here on Out
Many of our regular readers are probably well aware of the recent Bitfinex-Tether scandal which involved a whopping sum of $850 Million. In relation to the matter, Ethereum co-founder Joseph Lubin stated that moving forward, this mess would affect Bitfinex’s reputation in a big way — so much so that it would not be shocking to see the exchange lose a massive chunk of its core clientele by the end of 2019.
While giving an interview at the recently concluded Fluidity Summit conference in New York, Lubin was quoted as saying:
“It seems like a really big mess that probably won’t get better. Tether is somewhat important to our ecosystem because it’s used by different institutions to effect more fluid trading. There are other price-stable tokens out there — many others — and I think they’re going to gain traction because of this. I think that will be a really good thing.”
A Little Recap Of The Associated Happenings
As mentioned previously, the New York Attorney General’s office recently accused Tether and Bitfinex of taking part in a cover-up scheme that involved a total of $850 million — with the AG’s office stating that the above-stated sum of money was used to hide losses that had been incurred by the Tether project over the course of 2018.
Since then, Tether’s executive brass has come forth and disclosed that its USDT stablecoin is backed by cash as well as other “short-term securities” that amount to around 74% of the firm’s outstanding token tally.
This is quite shocking to hear since Tether’s market USP from the very beginning has been that
“each of its tokens are backed by the US dollar”.
Additionally, this is not the first time Tether and Bitfinex have indulged in nefarious activities since back in 2017 both organizations were sent subpoenas by the U.S. Commodity Futures Trading Commission (CFTC) for manipulating the price of BTC in an unlawful manner.
“All prices on the planet are being manipulated. Any time that well-resourced actors can get in there and do something, you have to expect them to do that. So we need to build better systems.”
In closing out this piece, it should be pointed out that the crypto world has been faced with a few scandals of this nature over the course of the past 24-36 months. However, with that being said, it still seems as though a lot of investors have immense confidence in this burgeoning sector. This is highlighted by the fact that since the start of the year, the values of BTC, as well as many of the other premier altcoins (available in the market today), have surged massively.
Lastly, in regards to the matter, Lubin was quoted as saying:
“The status of things is great. Since that price correction, the system has grown enormously because the people who build the systems, who were pulled in by excitement driven by price growth, stay in the system. Once you’ve seen the potential, you can’t un-see it.”