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Santiment Agency Calls USDT Best Stablecoin, Warning It May Be in for Trouble in Future

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Fri, 12/07/2018 - 10:45
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  • Santiment agency, working with data on the crypto market, has released a report in which it dubs Tether the most stable of all similar assets – stablecoins

Cover image via U.Today
Contents

 

Santiment crypto analytical agency has recently issued the results of the research it made on stablecoins. Nine assets were looked into deeply but the firm chose Tether (USDT) as the most stable from them all.

Fiat-pegged coins lead the parade

USDT became the winner. Three other stablecoins followed it – USD Coin (USDC), PAX (Paxos Standard Token) and the Winklevoss-issued GUSD (Gemini Dollar).

The research was based on a standard deviation analysis. The tests showed that out of all the nine participants, USDT proved to have shown the highest stability over the year.

One of the curious outcomes the researchers came to is that all the assets that made it onto the winners’ list are all pegged to a fiat currency.

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Other details of the report

Santiment also performed a linear regression test, gauging the volume of the stablecoin versus the volatility of its price within a certain time period.

One of the goals the research pursued was to figure out the factor of volatility for stable crypto coins versus the volume of the coin. The analysis for the volume was performed in two categories: 1) the market volume of the asset; 2) taking to the value of Bitcoin market for comparison.

The trials showed that similarly to all other virtual coins, stable assets show a strong reaction to high volume and demonstrate volatility concerning price. Still, the decentralized DAI coin demonstrated a positive rise on both aforementioned criteria. Another report of the agency, though, proved that the actual use of DAI has greatly increased recently.

Recent ‘Tether-pegged’ controversy

Many may find it surprising that Tether has become the winner of the abovementioned tests. Often enough, this coin was in trouble for its controversy and recently it even nearly lost the sablecoin status but quickly recovered in the market.

It is now a well-known fact that Bitfinex exchange and the Tether company are run by the same management team and have mutual banking partner. Recently, law enforcement organizations have investigated the connection of Tether and Bitfinex to a possible market manipulation. Bitfinex was allegedly making extra USDT coins which were not backed by the USD.

As pressure of regulators increased, Bitfinex launched trades of USDT against such fiat assets as EUR and USD. Earlier, U.Today also reported that Tether now has enabled its customers to take out their Tether coins in USD on condition they withdraw a minimum of $100,000.

To sum up

Finally, Santiment agency believes that even though Tether is the winner in the research, still the intensifying debates regarding its centralization and the negative attention of legal agencies that the coin attracts may turn out to be a hindrance in the expansion of its popularity.

About the author

Yuri is a journalist interested in technology and technical innovations. He has been in crypto since 2017. Believes that blockchain and cryptocurrencies have a potential to transform the world in the future. ‘Hodls’ cryptocurrencies. Has written for several crypto media. Currently is a news writer at U.Today, can be contacted at yuri.molchan@u.today.

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