There is a huge flood of Tether (USDT) tokens into 1 particular wallet address. The address belongs to the Kraken exchange. Kraken remains one of the few places in the world, where you can convert your USDT into USD. The exchange’s wallet balance currently stands at 47.2 million USDT. According to the Tether rich-list, the 47.2 million makes Kraken’s account the 8th richest account in the world.
This shows how much can actually change during a two-week development. On the 7th of October, Kraken’s Tether wallet held less than half of its current balance. On the tether rich-list, Kraken was ranked 22 and had a balance of 21.6 USDT. If we go back in time, we can see that between the January 2018 and early October 2018, Kraken’s balance grew from 10 million USDT to 24 million.
Kraken experienced the largest influx of volume it had
According to some market watchers, the current balance is due to a growing traders need to trade USDT for USD. Being one of the very few exchanges, allowing the USDT/USD trading pair, Kraken stands to benefit from this rise of interest. Another exchange, that offers USDT/USD trading is Bitfinex. The exchange has very close ties with Tether Ltd, which is the issuer of USDT.
With the USDT exchange rate falling significantly below its $1 last week, it’s natural that the market has its doubts. Combined with the USD experiencing some slight turbulence of its own many users question if Kraken would offer other forms of trading. Currently Kraken only offers one pair of trading and that is USDT/USD. This means traders cannot trade USDT for any other crypto or fiat currencies on the exchange.
Some market observers argue that this influx signals a huge wave of traders wanting to offload USDT. Tether’s exchange rate fell the lowest during October 15th. Kraken experienced the heaviest selling pressure and USDT managed to touch $0.85 for a while. October 15th also saw the biggest trading volume ever recorded on the exchange. Back in 2016 when the white paper was introduced, it was strictly noted that USDT would be redeemable for USD by Tether Ltd.
Rumors are flying around that a number of token holders haven’t been able to do so in the last few months. This can explain the huge rush of users to Kraken. The inability to convert USDT to USD at will also shaked the market quite a bit. While Kraken can use the influx of USD to look towards other cryptocurrencies, this isn’t the first time USDT has concerned the markets. Even though Tether is the 8th most valuable cryptocurrency by market capitalization, Tether has many of its users doubting about whether or not its tokens are fully collateralized by USD deposits. This doubt is further fueled by the company refusing to provide regular public audits as it is written in the white paper.