Tether (USDT) is a popular cryptocurrency that has demonstrated remarkable success in recovering the loss of value after two separate major incidents this year. Following a drop in USDT's exchange rate to below $1 when TerraUSD exploded, and again in November with the failure of FTX, Tether's market capitalization has now recovered to an impressive $81.4 billion. The reserves behind the USDT issue are still valuable, despite the questions raised in the past by regulators, including those from the US Securities and Exchange Commission (SEC).

The factors influencing the success of Tether include the surging Bitcoin prices, which has contributed to a massive market rally. Additionally, more merchants are reportedly moving away from the US due to increasing regulation, as Tether is based on the British Virgin Islands, creating a fertile ground for its growth. On the other hand, competitors like Circle’s USD Coin are experiencing a 30% fall in market capitalization.

The rise of Tether has simultaneously been linked to a trend of some financial institutions shunning customers who invest in cryptocurrency, with stablecoins being seen as the only practical option for partaking in the crypto world. Meanwhile, enforcement action by the SEC and New York resulted in Paxos Trust Co. ceasing the issuance of BNB stablecoin BUSD, a move that caused a 60% decrease in market cap.

Despite the lack of full audit of Tether's reserves during the years, no wrongdoings were found after an investigation conducted by regulators of the state of New York. This puts the USDT issuer in a more favorable legal position while users remain confident in their holdings. Thus, the current market dynamics suggest that Tether is likely to remain an attractive asset to investors interested in the cryptocurrency industry.



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