Tether Shorters Won’t Win, Says Ardoino

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  • Tether CEO Paolo Ardoino has detailed the lengths that Tether shorters are going to in order to crash the price
  • Traditional hedge funds have begun massively shorting the stablecoin and spreading FUD to help their cause
  • Ardoino says that Tether will not break under the pressure

Tether CEO Paolo Ardoino has said that the entities continually shorting Tether’s USDT token will fail, following a report from the Wall Street Journal that more and more institutions are taking on such a bet. Ardoino was prompted to comment after the article, which appeared on Monday, said that more institutions are shorting Tether following the Terra USD collapse. However, Ardoino pointed to Tether’s performance in the wake of the Terra collapse as an example of how well the coin is holding up, as well as listing the ways in which shorters have attempted to manipulate the USDT token price.

Traditional Hedge Funds Shorting USDT

The ability or otherwise of Tether to back its multi-billion-dollar market cap has been the subject of much discussion since 2017, with the spectre of a Tether collapse acting as one of the cryptocurrency space’s most commonly referenced ‘black swan’ events.

It seems that institutions are now actively following the same train of thought, with the WSJ saying on Monday how more and more hedge funds were betting on the collapse of the USDT token. Interestingly, the paper reported that the short trades in question are being almost exclusively put on by traditional hedge funds, while crypto firms—especially those based in Asia—have been happy to facilitate the other side of the transactions.

Tether Shorters Taking on Battle Hardened Coin

These short sellers have been actively putting about unsubstantiated theories about Tether’s backing, such as suggestions that it has exposure to bad debt in China, as a way of trying to sew more discord, tactics that could become more widespread and aggressive if USDT fails to fall.

Ardoino alluded to these tactics in a tweet thread in which he outlined the tools that were being used to attack Tether, commenting that coordination seemed an almost certainty:

Ardoino pointed to Tether’s expansion into different currencies, such as the euro and British pound, as evidence that its backing was legitimate, as well as its massive reduction in commercial paper, its regular reports to the New York Attorney General, and its imminent audit. He also added that the company has never failed to honour a redemption.

Ardoino signed off by saying that USDT was the only stablecoin that is “proven with fire under extreme pressure”, and indeed so far his words have been backed up by the performance of the token, and there is no evidence to suggest that Tether can’t continue to honour its obligations.

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