According to a new study from the Center for Economic Policy Research, Stablecoins do not inflate the price of Bitcoin and other cryptocurrencies.
Scholars Richard K Lyons from UC Berkeley and Ganesh Viswanath-Natraj from Warwick Business School have studied the issuance of Tether (USDT) and other stablecoins over the past three years, including the price pump at the end. 2017.
Contrary to popular belief that the Bitcoin price is being manipulated by the amount of new Tether, the researchers found little correlation between the BTC price and the amount of newly released stablecoins:
“Conclusion: We found no systematic evidence that stablecoin issuance drives cryptocurrency prices.”
So what's going on?
Experts have studied primexbt trading a lot of data and transaction patterns between Tether and other cryptocurrencies and determined that Stablecoins issued and used are still in the right direction: as a store of value. stable and a safe haven from market volatility.
In times of risk, some investors will look to trade assets that offer good stores of value, the researchers note. Portfolio Rebalancing with Tether and Stablecoins is an option with minimal intermediaries.”
They argue that the release of Stablecoins is to meet the needs of the market:
“Our evidence supports the notion that stablecoin issuance helps to correct deviations in secondary market rates from pegged rates, and these stablecoins have always performed a role of increasing volatility. secure digital economy.”
See more: Crypto Analyst: Bitcoin Price Closes to Buying Opportunity
Beliefs about market manipulation
Tether theorists have long pointed to a 2018 study by John Griffin from the University of Texas and Amin Shams from Ohio State that claimed the 2017 bull run was manipulated by Tether.
They found that “the purchase of Tether was timed after the market downturn and resulted in a significant increase in the Bitcoin price.” The controversial statement caught the attention of both crypto enthusiasts and the mainstream press.
The idea that the Tether issuance precedes Bitcoin price pump action is now seen by some as a bullish sign. For example, an article on Bitcoinist yesterday argued that the lack of BTC price after a large amount of Tether was released could point to a new bull run.
Lawsuits that have taken place
The University of Texas research has been used against Tether and iFinex in lawsuits surrounding market manipulation. This latest research casts doubt on those claims, which Tether has dismissed as having “no validity and no legal basis.”
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