Published on June 13th, 2018 | by bitcoin0
Tether has once again become the source of criticism after a new study blamed it for Bitcoin price manipulation in 2017, The New York Times reports Wednesday, June 13
Tether (USDT) has once again become the source of criticism after a new study blamed it for Bitcoin price manipulation in 2017, The New York Times reports Wednesday, June 13.
A paper released June 13 by John M. Griffin and Amin Shams of the University of Texas suggests that transaction patterns show Tether was “used to provide price support and manipulate cryptocurrency prices.” Half of the Bitcoin price rise in December 2017, when the cryptocurrency reached all-time highs around $20,000, was explicitly due to Tether and issuer Bitfinex, the researchers claim.
“Using algorithms to analyze the blockchain data, we find that purchases with Tether are timed following market downturns and result in sizable increases in Bitcoin prices,” the paper’s abstract summarizes.
“Less than 1% of hours with such heavy Tether transactions are associated with 50% of the meteoric rise in Bitcoin and 64% of other top cryptocurrencies.” Tether has routinely fallen under suspicion since late last year after repeat releases of coins onto the market had an immediate knock-on effect on Bitcoin prices.
Griffin and Shams’ hypothesis has this time also become fodder for mainstream media, publications seizing on the information to demonstrate the allegedly opaque nature of Bitcoin markets.