It seems there’s a certain divestment philosophy gaining around the use of the stablecoin Tether (USDT) which has been traditionally tied to the U.S. dollar as a less decentralized means of using cryptocurrency.
A report today by Marc Hochstein at Coindesk goes over one instance of this type of divestment from a payment coordinator named Strike that governs remittances in El Salvador.
Quoting Strike CEO Jack Mallers who said he “didn’t have a choice” in originally introducing Tether into the mix, Hochstein also reveals that one of the reasons Tether is coming under pressure is scrutiny from the New York Attorney General’s office as fallout from the Bitfinex-Tether imbroglio, where one of those two parties is alleged to have lost some $800 million.
In scrutinizing new data produced by the stablecoin’s leadership, Hochstein also points out that Tether’s collateral holdings are a bit murky.
The majority, as he shows, is based on “commercial paper” or corporate debt, where there aren’t a lot of details available about the stability of such assets.
By contrast, there is only 4% in cash, and 3% in U.S. Treasury bills. That might be a surprise to cryptocurrency fans who thought that Tether was more, well, tethered to the U.S. treasury.
As for Maller, in explaining Strike’s use of tether and the timeline, the exec mentioned “minimum viable product” as a driving rationale.
“You launch with Tether, you growth hack, you learn and be a good listener, be a good observer, you end up meeting with the president and helping to find regulatory clarity in the country,” Maller reportedly said in an interview with podcast host Pete McCormack. “And then you roll Tether out, get it the **** out of here.”
Given the unpopularity of Tether in some quarters, it seems relevant to consider the move away from BTC pure plays by companies like Microstrategy and Tesla. What is the future of crypto? What types of coins and assets will win out? We will continue to bring you the news of the day as you put together your own defi and crypto portfolio.
