Coinbase Pro Lists Controversial Crypto Stablecoin Tether: What You Need To Know
Coinbase Pro, the crypto exchange owned by the newly public Coinbase Global Inc (NASDAQ: COIN), has announced that it will list crypto stablecoin Tether (USDT).
What Happened: USDT has its value pegged to the value of the U.S dollar and is the largest stablecoin by market cap.
Although it operates on a number of blockchains, Coinbase Pro says it will only support the ERC-20 USDT running on the Ethereum blockchain.
Trading is set to begin “on or after 6 PM Pacific Time on Monday, April 26,” subject to the liquidity conditions being met.
Why It Matters: With over $49 billion in market cap, USDT forms the backbone of the majority of crypto trading as it is the most common trading pair on several exchanges. Despite its status as the number one stablecoin, USDT has been the subject of controversy for a number of years.
Tether Limited, the company behind USDT, was the subject of a New York Attorney General (NYAG) inquiry in 2019.
NYAG Letitia James obtained a court order against Tether and affiliated crypto exchange Bitfinex for the alleged cover-up of an $850 million loss.
Tether was also under scrutiny regarding whether USDT was actually backed one-for-one by the U.S dollar.
Earlier this year, the inquiry ended in an $18.5 million settlement with Tether admitting no wrongdoing and agreeing to provide quarterly reports on its reserves.
See also: How to Buy Tether (USDT)
Coinbase’s decision to list the stablecoin may serve to dispel any Tether FUD that still remains in the market, as well as provide more arbitrage opportunities to traders.
Price Action: Tether (USDT) was trading at $0.99 at press time. The trading volume increased by more than 45% after the announcement.
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Coinbase Pro Announces Listing of Stablecoin Tether (USDT)
Coinbase, the US-based cryptocurrency exchange, announced support for stablecoin Tether (USDT) and mentioned that the trading of USDT will start on Coinbase Pro from Monday 26 April. Trading will be available in the company’s supported jurisdictions.
According to the official announcement, Coinbase is only supporting ERC-20 USDT running on the Ethereum blockchain. Coinbase Pro users are now allowed to transfer Tether (USDT) into their accounts ahead of the trading.
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Tether is the most valuable stablecoin in the world. The cryptocurrency currently has a market cap of approximately $50 billion. USDT is the 4th most valuable digital currency in the world. The total market cap of Tether has surged significantly since the start of this year.
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“Starting immediately, we will begin accepting inbound transfers of Tether (USDT) to Coinbase Pro. Trading will begin on or after 6 PM Pacific Time (PT) Monday, April 26, if liquidity conditions are met. Please note that Coinbase only supports ERC-20 USDT. Once sufficient supply of USDT is established on the platform, trading on our BTC-USDT, ETH-USDT, USDT-EUR, USDT-GBP, USDT-USD and USDT-USDC order books will launch in three phases, post-only, limit-only and full trading,” Coinbase mentioned in the official announcement.
Coinbase Listing
The American cryptocurrency exchange is one of the largest digital exchanges in the world. Coinbase recently went public through a direct listing on Nasdaq under the ticker symbol of COIN. The shares of the company jumped nearly 30% on its debut but saw a correction in the following days. According to the closing price of Thursday, COIN shares dropped below $300. The cryptocurrency exchange reported a significant jump in trading volumes during Q1 of 2021. The company also reported total revenues of approximately $1.8 billion during the first three months of 2021.
The recent Tether support from Coinbase came after the company expanded its product offering with the addition of several digital currencies, including Ampleforth Governance Token (FORTH), Enjin Coin (ENJ), NKN (NKN), Origin Token (OGN), Ankr (ANKR) Curve DAO Token (CRV), Storj (STORJ) and Cardano (ADA).
Tether market capitalization hits $50 billion as use of the US dollar stablecoin grows
In this photo illustration, a smartphone displays the Tether market value on the stock exchange via The Crypto App. Photo Illustration by Guillaume Payen/SOPA Images/LightRocket via Getty Images
Tether surpassed a market capitalization of $50 billion on Sunday.
The fifth-largest cryptocurrency has more than doubled its value since the start of 2021.
Data shows that tether had the highest sentiment score across social media, news, and other online content.
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The US dollar stablecoin Tether surpassed a market capitalization of $50 billion on Sunday.
A stabelcoin is a type of cryptocurrency that is backed by a reserve. In the case of tether, or USDt, it is pegged to the dollar, affording it more stability compared to other cryptocurrencies.
Paolo Ardoino, CTO at Tether, said this $50 billion mark has been a milestone since Tether’s founding in 2014. This means that there are now more than 50 billion USDt in circulation, with daily trading volume exceeding $140 billion, data from CoinGecko shows.
“Tether’s success is a blueprint for a central bank digital currency and a banking system of the future,” he said in a statement. “We are truly humbled by the pivotal role that tether now plays in the digital token ecosystem across myriad protocols and applications.”
The exponential growth of tether - doubling from $18 billion at the start of 2021 - indicates growing use and positive sentiment toward the stablecoin.
Data from Sentifi, an alternative data company, on Monday show that tether had the highest sentiment score across social media, news, and other online content.
On April 22, newly listed Coinbase, the largest cryptocurrency exchange in the US, gave its stamp of approval by listing tether to Coinbase Pro.
Still, tether is not without controversy. The fifth-largest cryptocurrency and most popular stablecoin by market capitalization went through a legal battle with New York that began in 2019.
“Tether’s claims that its virtual currency was fully backed by US dollars at all times was a lie,” New York Attorney General Letitia James said in a February 2021 statement, banning the stablecoin from trading in the state.
She continued: “These companies obscured the true risk investors faced and were operated by unlicensed and unregulated individuals and entities dealing in the darkest corners of the financial system.”
Tether agreed to pay an $18.5 million fine to settle the dispute, though admitted to no wrongdoing.
“Contrary to online speculation, after two and half years there was no finding that Tether ever issued tethers without backing, or to manipulate crypto prices,” it said in a statement.
Since the start of the year, tether added $29 billion to its market cap, a gain that is greater than the combined valuation of all rival stablecoins.
Tether peaked at an all-time high of $1.26 in July 02018, according to CoinGecko. When it first debuted, the price of each token was $1.