Noble Bank, a financial entity based in Puerto Rico, is said to be for sale for $5 to $10 million, as reported by Bloomberg. The mystery around the bank thickens, as an unnamed source close to the bank also alleged that Noble also abandoned its most prominent clients, the Tether company and Bitfinex.
If the sources are correct in their allegations, that would leave Tether without access to a legal bank account, after Wells Fargo dropped the crypto project a few months ago.
Bloomberg reported further that the unnamed source mentioned Noble Bank still has a banking license to operate as an international financial company in Puerto Rico, and that is the basis for the selling price tag.
The news of troubles with the banking of Tether has reignited fears of a fast-unraveling of the most influential dollar-pegged coin on the markets. USDT selling for cash on Kraken is used as an illustration. On Kraken, selling USDT for USD often sees the price fall significantly, as low as $0.89. And while in general USDT keeps its dollar peg, it is vulnerable to a run from investors.
In effect, official withdrawals of Tether from the website are so slow and expensive, they are hardly ever used as a fiat off-ramp.
A crisis with Tether would affect markets seriously, as more than 21% of total volumes for all coins and tokens are made up of USDT pairings. A loss of value would wipe out a multitude of assets that until now have performed relatively well.
So far, neither Tether, nor Bitfinex have commented on the issue, and business continues as usual in the crypto space. The inertia of USDT trading is hard to overcome, and the asset is ubiquitous in creating dollar-like prices for assets.
Since June 25, USDT tokens have remained stable, with no new large tranches minted. Instead, the Tether treasury had periodic injections into Bitfinex, where users noticed bot behavior coincided with spikes in the price of Bitcoin (BTC). There are doubts how much USDT affects prices directly, but its importance cannot be underestimated.
To notice how ubiquitous Tether is, a graphic representation of USDT movements from the treasury shows the flow of tokens.
Others have noted a connection between dedicated trading bots, which increase the influence of USDT by automated orders and trades.
Neither the author nor the publication assumes any responsibility or liability for any investments, profits, or losses made as a result of this information. Cryptocurrency trading and investing are risky propositions, and market participants are advised to always conduct thorough research.