Bitcoin Price Run Powered By Real Demand, Not Tether Manipulation

Jesse Powell, chief executive officer of Kraken Bitcoin Exchange, sits for a photograph at the company’s office in San Francisco, California, U.S., on Friday, Aug. 8, 2014. (David Paul Morris/Bloomberg)

© 2014 Bloomberg Finance LP

Throughout Tether’s history, there have been many accusations made against the U.S. dollar-backed stablecoin regarding everything from bitcoin price manipulation to outright fraud. Having said that, Tether is currently trading at $0.9978, which would indicate a sign of approval from the market.

Recently, a number of bitcoin skeptics have been claiming that the cryptocurrency’s recent bull run is based on manipulation of Tether and bitcoin on exchanges rather than any sort of real, organic demand.

On Monday, Jesse Powell, who is the CEO of crypto asset exchange Kraken, was asked for his opinion on this topic during an interview with TD Ameritrade Network. According to Powell, the supposed bitcoin price manipulation powered by Tether looks quite different from behind the scenes.

Tether a More Transparent Version of Normal Exchange Activity

When asked specifically about any sort of connection between the massive increase in the supply of Tether over the past few months and the increase in the bitcoin price, Powell was quick to point out that this sort of correlation is also seen behind the scenes at pretty much every bitcoin exchange that uses normal bank deposits.

“I don’t have inside knowledge of what’s happening at Tether, but I can tell you that, historically, when you’ve seen growth in the supply of Tether, we’ve seen growth in the supply of U.S. dollars coming onto Kraken. And other exchanges would report the same,” said Powell.

Powell added that Tether is simply a much more transparent version of what’s happening on all of the exchanges during times when the bitcoin price is increasing, the media is reporting heavily on the price increase, and retail investors are rushing…

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