Popular

Where are Tether and Bitfinex banking today?

advertisement

4 short months ago, it was revealed that Bitfinex and Tether were banking with Noble Bank of Puerto Rico after being dumped by Wells Fargo in 2017. Fast forward to today, and Noble Bank is on the block for a reported $5-10 million, or the value of their Puerto Rico banking license, as Bitfinex and Tether are no longer customers. This leaves many questions open: 

  • Who are Bitfinex and Tether banking with today?
  • Why did Bitfinex and Tether leave Noble Bank?
  • What happened to Noble Bank's other cryptocurrency customers?
  • Why did BNY Mellon end its custodial relationship with Noble Bank?

In any case, the lack of transparency into Bitfinex and Tether operations continues amidst continued uncertainty. The questions come at a particularly fragile time for the cryptocurrency, as Gemini and a host of others have recently introduced their own stablecoins. Stablecoins are meant to hold their value to a peg and reduce volatility to allow for cryptocurrency use as money.

Gemini's stablecoin, the Gemini Dollar, poses a unique threat to Tether, as it is regulated in the United States, having been officially accepted by the New York Department of Financial Services. This approval is likely to be very attractive to institutional clients looking for stability as they hold stablecoin balances in order to enter and exit cryptocurrency trades.

The explosion of new stablecoin options has come amidst Tether's breakout success over the past 18 months, in which it increased to $2.8 billion in "market capitalization." (Source: Bloomberg)

Trending Stories

Get Your Crypto
Daily Brief

Delivered daily, straight to your inbox.

More