Untether.Space: Website Tracks Tether (USDT) Stablecoin Risk

According to the Merriam Webster dictionary, Untether refers ‘to free from or as if from a tether’. Wikipedia defines it as ‘an action that facilitates an action of a technical device without a direct control.’

Tether is a cryptocurrency with tokens, with each token backed by one US dollar. Designed by Tether Limited, Tether is otherwise known as a ‘stablecoin.’ It was designed to always be worth one US dollar and its price fluctuates very little against the US dollar.

There have been rumors and some evidence that tether may not have enough dollars to back the amounts issued. The cryptocurrency has however kept its USD value steady in the market. This makes it trustworthy to traders that use it as hedge during bear markets worldwide. Tether uses the Omni Layer Protocol since it does not own its own blockchain. All tether transactions are public and have lists of the richest tether accounts and current reserves of US dollar and the Tether.

What Is Untether.Space?

Reputable bitcoin exchanges often give their customers the option to exchange their cryptocurrencies for the US dollar. Larger exchanges like Bitfinex only offer the option of Tether tokens, which are exchangeable one tether to one US dollar.

The Untether site tracks the risk between the Tether and US dollar. Tethers are riskier than USD and exchange sites often ask for more Tethers in exchange for a Bitcoin.

There have been claims of tether printing to manipulate the price of Bitcoin. Some statistics have supported that Tether was used to buy Bitcoin in crucial occasions. This was mostly during the rise of Bitcoin prices of 2017 and early 2018. For instance, John M Griffin wrote a paper on account that Bitfinex and Tether Limited would print Tether just after price drops in Bitcoin. Freshly minted Tether would then be used to buy Bitcoin and create a bullish market. This would then attract investors to buy more Bitcoin.

Untether.Space Tracks Tether (USDT) Stablecoin Risk

There is a risk premium attached to Tethers because they are riskier than the US dollar. This risk premium demands more Tethers than US dollars in exchange for Bitcoin. Untether.space tracks the risk premium.

Updates happen every thirty seconds. The site tracks exchanges using Tether for Bitfinex, Bittrex, and Poloniex. It also tracks exchanges using the US dollar for GDAX, Bitstamp, and Kraken. It the gives the weighted average for each.

Why Untether.Space?

Tether limited was suspected to have sent their freshly bought Bitcoin to accounts they hold in Bitfinex. Some have speculated that they would then sell the Bitcoins slowly in their own or other exchanges or to private investors OTC (over the counter). OTC is highly profitable, as it allows Bitfinex to monetize the whole transaction in dollars.

Thether Limited has issued over $2 billion in tether but it has never been audited. If Tether is not backed by the US dollar, tether holders might try to branch out into other cryptocurrencies at whatever prices available. The prices in those exchanges will skyrocket and trap customer funds when they become insolvent.

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