Tether was not behind Bitcoin’s rise over $8,000 yesterday, after suggestions that the money machine printed another $500 million in USDT to spark a 5% rise. The confusion stemmed from a sudden increase in USDT’s market cap by that amount, which some equated to a sudden injection of capital, but there seems to be a much more reasonable explanation involving Tron-based USDT.
Bulls Jump to Conclusions
Eagle-eyed Twitter users spotted the sudden increase in the USDT market cap from $4.14 billion to $4.63 billion which occurred at exactly 9pm UTC on Monday night, leading to a flurry of rumors that Tether had fired up the printing presses and let rip:
#Tether printing machine is running again?
Does the recent #bitcoin price rise to 8000$ happen because of #USDT? ?
And could it be a beginning of a new crazy bull wave?$BTC $BTCUSD pic.twitter.com/snE7FqAaMy
— CryptoHamster (@CryptoHamsterIO) January 7, 2020
Interestingly, at the exact same moment, BTC put in the first of four green hourly candles in a row, jumping from $7,544 to $8,009. There’s no telling of course whether the ‘news’ had time to filter through and impact the market in such a way, but judging by the reaction on social media, the ‘tether printing’ meme is still going strong – despite the community simultaneously denying that USDT printing leads to Bitcoin price rises, as was inferred by John M. Griffin and Amin Shams in 2018 and again last year.
TRON Tokens Added to Market Cap
What actually happened to cause USDT’s market cap jump was much less dramatic – CoinMarketCap simply added the USDT tokens running on the TRON blockchain. USDT runs on three different blockchains, Ethereum, Omni, and TRON, and it seems that CoinMarketCap hadn’t yet got round to adding the $500 million that operates on the TRON blockchain yet. This explains the instantaneous speed of the increase and the increase itself, and it didn’t take long for the real explanation to become clear:
@coindesk , there’s no “increase” in @Tether_to ‘s market cap (#USDT). It seems like @CoinMarketCap just updated it because they were not counting #USDT @ #TRON blockchain.https://t.co/hqE8NVcFMM
— StablecoinsWar (@StablecoinsW) January 7, 2020
Bitcon’s Rise is Nothing to do With USA/Iran Either
The reality of the situation shouldn’t come as a surprise, given that Tether has been much more conservative in its printing habits of late, and this would have represented its biggest ever single print. Still, it didn’t take much for people to fall over themselves to proclaim that the bull market was on its way, when in truth there’s as much chance of a mass USDT print causing a Bitcoin rush as the US’s potential war with Iran.
And for clarity, that’s bullshit too.