Over-the-counter cryptocurrency platform Cumberland did not rule out that the next asset at risk of a crash would be one of the leading stablecoins.
The next major shoe to drop would be a top-2 stablecoin. If that happens, there will be generational buying opportunities in BTC & ETH. If not, the market probably calms down for a while. —@jvb_xyz
— Cumberland (@CumberlandSays) June 14, 2022
“The next negative event will be the collapse of a top-2 stablecoin. If that happens, there will be buying opportunities in BTC and ETH. If not, the market is likely to calm down for a while,” Cumberland predicted.
As of writing, the top two stablecoins by market capitalization were USDT ($71.18 billion) and USDC ($54.3 billion).
Cumberland also noted that the OTC desk is currently processing “the largest flows of the year.”
After a period of relative calm, we are now seeing the largest flows of the year through our OTC desk. This is a bit unexpected, and likely a signal that we are nearing either a local bottom, or _the_ bottom.
🧵👇
— Cumberland (@CumberlandSays) June 14, 2022
“This is a bit unexpected and probably signals approaching either a local bottom or the bottom,” the thread says.
Cumberland was founded by DRW in 2014 and, according to some reports, is the largest liquidity provider in the crypto industry thanks to the USDT issuer Tether. In 2021, media reported that the market maker and Alameda Research bought more than two-thirds of the total issuance of the stablecoin.
In comments, Placeholder venture partner Chris Burniske noted that he is watching USDT closely. He called the odds of a collapse of this stablecoin low, but admitted that he is more concerned about the current situation “than ever.”
I continue to give $USDT failure low odds, but I’m admittedly more concerned than I’ve ever been on it.
Used to dismiss Tether FUD immediately.
— Chris Burniske (@cburniske) June 15, 2022
“The only reason I’m talking about this now is that I’m being pinged about it too often to ignore. And if Risk = Probability x Consequence, the consequences here are extremely serious if this happens,” Burniske wrote.
On May 12, the price USDT tested the $0.94 level amid market turbulence, while USDC and BUSD looked relatively stable. Paolo Ardoino, Tether’s technical director, said the company’s reserves would be enough to redeem all assets at a 1:1 ratio with the US dollar.
On June 13, Tether said that negative events with Celsius did not affect the financial stability of the USDT issuer.
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