Asian traders are still gaga over Tether

Macro•April 29, 2019, 8:47AM EDT
UPDATED: April 18, 2021, 9:32AM EDT
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Asian traders are still gaga over Tether
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Quick Take

  • Bitfinex and Tether got hit with a lawsuit from the NYAG’s office
  • But that hasn’t kept Asian traders from sticking by the cryptocurrency, which sources say is superior to its rivals

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This post first appeared in Frank Chaparro’s weekly column “Mad Crypto,” which is sent to Genesis subscribers’ inbox every Monday morning. 
 
Since breaking the news that the NY Attorney General is suing crypto exchange Bitfinex and Tether, I've been ruminating about how - surely now - people will want to wash their hands of them.
 
[related id="1"]Sure, Tether has long shrugged off rumors of insolvency and maintained its position as king of the stablecoins; an omnipresent force on any over-the-counter trading desk. But this seems different right? You would think most traders would move on after such a suit.
 
Still, even with such a large crop of stablecoins for traders to pick from, my over-the-counter trading sources in Asia tell me most are unshaken by the news and still have confidence in the now beleaguered digital currency.
 
"By and large Asians still have confidence in Tether," Darius Sit of QCP Capital, an OTC shop in Singapore, noted. 
 
Another executive in the region added: "Asian traders have an abundance of confidence in Tether," the person said. "As a hedge fund said to me last night, 'we still haven't seen any alternatives to Tether.'"
 
I mean, that's not quite true given last year's Cambrian Explosion of stablecoins. Rob Paone, Head of growth at AirSwap, summed this up nicely in his tweet: "Luckily the crypto industry didn't spend all of 2018 creating roughly 47 different stablecoin alternatives to Tether, right?" Indeed, it seems like hundreds launched in 2018 - including the likes of Gemini Dollar, Paxos' PAX, and USDC. 
 
Nonetheless, traders tell me that Tether provides a superior experience versus U.S.-based stablecoins, having had issues redeeming coins. 
 
"People have tried to redeem even single digital millions (tiny really) and Gemini has failed to allow those redemptions," one person said. "Whereas even with these events, Tether [redemptions] are working fine."
 
This post first appeared in Frank Chaparro’s weekly column “Mad Crypto,” which is sent to Genesis subscribers’ inbox every Monday morning. 

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