U. S Regulators Eyes Cryptocurrency Market
Not long after receiving a subpoena from the United Sates Commodity Futures Trading Commission last month, Bitfinex created over one-third of the total supply of Tether the next day.
Reports emerged recently that Bitfinex and Tether were issued with subpoenas by the United States Commodity Futures Trading Commission (CFTC) on the 6th of December, 2017. Although not many details of the subpoenas were known, it has led to a lot of questions regarding the integrity and transparency of both companies.
From February of last year, the number of USDT in circulation has went up by nearly 9,000 per cent, earning from around $25 million at the beginning of February 2017 to more than $2.25 billion at the end of January 2018 as stated by Coinmarketcap.
Since they were given the subpoena, Tether has increased the amount of USDT by 775 million, that’s an increase of 52.5 per cent in the total supply from December 6th of last year. Around 34.5 per cent of all USDT created were all after the subpoena was delivered.
General speculation is to blame for the increasing of USDT issuance as an attempt by Bitfinex and Tether to manipulate the BTC markets after the subpoena. Most reports note that a lot of Tether created since December 6th could have been made without USD backing, and went on to trade on exchanges to raise price to record highs prior to the existence of the subpoena was revealed
However this is not the first time the Bitfinex is being accused for insider trading. Back in early 2013, a fed up former Bitfinex worker leaked an email between him and Raphael Nicolle, the former CEO of Bitfinex. The email claims insider trading among Bitfinex top brass
The chairman of the United Sates of Securities and Exchange Commission, Jay Clayton and the chairman of CFTC, J. Christopher Giancarlo wrote an open letter recently discussing their views on the role of the regulatory institutions with regard to the cryptocurrency markets.
U.S. Treasury Secretary Steven Mnuchin has also weighed in on cryptocurrency regulation. Mnuchin has stated that he will raise cryptocurrency regulation at the next G20 summit slated to take place in Buenos Aires (Argentina) from November 30th-December 1st, 2018.