A wallet address that’s controlled by crypto exchange Kraken is witnessing a deluge of Tether (USDT) tokens. The reason behind this flooding of USDT tokens is that Kraken is one of the few places where this troubled stablecoin can be easily converted into U.S. dollars. According to the Tether Rich List, Kraken’s wallet balance stands at around 47.8 million USDT at the time of writing, thereby making it the eighth-most valuable wallet holding the said asset.
However, the situation was quite the opposite around two weeks back. On October 7, Kraken’s Tether wallet ranked at 22 and held less than half of its present balance. The wallet balance fluctuated between 10 million and 24 million USDT during late December 2017 to early October 2018, as per the archived versions of the Tether Rich List.
The present Tether balance in crypto exchange Kraken’s wallet is a notable exception. The inference drawn by some market watchers is that traders intend to exchange their USDT for dollars. Kraken is one of those few exchanges that offer direct trades between dollars and USDT. Hence this influx of Tether is an indication that the crypto market may still harbor doubts about USDT. Earlier this week USDT’s exchange rate dropped significantly below its $1 peg.
A white paper published on Tether in 2016 stated that token holders are able to redeem their USDT for dollars by returning them directly to Tether Ltd. However, in the past few months, a number of users have been unable to do so.
Based on the Bitcoin blockchain, Tether is the most well-tested and secure public ledger and blockchain in existence. Tethers are completely independent of market forces, liquidity or pricing constraints. USDT tokens are reserved in a 1:1 ratio. As mentioned in the Tether white paper, the token has a simple and reliable Proof of Reserves implementation and undergoes regular professional audits.
Crypto exchange Kraken presently offers only one Tether pair: USDT/USD. Hence, traders cannot exchange Tether for any other cryptocurrencies on the platform. Apart from the above-mentioned facts, there are also other indications that traders are rushing to Kraken to offload USDT, as stated in the CoinDesk report. USDT’s exchange rate fell farthest against the dollar on October 15 and the biggest selling pressure was on the Kraken exchange. At Kraken, USDT briefly touched $0.85. The trading volume for Tether recorded the highest ever on that particular date.[The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views and/or the official policy of the website. ]