Tether Limited, the creator of USDT has unveiled that it seeks to issue a Chinese Yuan-pegged stablecoin. A report unveiled this news on August 21 after getting the information from Zhao Dong, a Bitfinex shareholder. The publication noted that Tether would hold the coin in offshore accounts under the CNHT ticker.
There are two types of Chinese Yuan. These are offshore (CNH) and onshore (CNY). While the People’s Bank of China (PBoC) regulates CNY, CNH does not have a regulatory agency to govern it. As such, the coin trades freely on foreign currency markets. The two currencies also have different rates
Dong noted that his crypto asset management firm dubbed “Renrenbit” would be the first to invest in CNHT. He went on to disclose that Tether and Bitfinex are in a side-by-side relationship. Furthermore, he noted that the two firms share the same management team. As at the time of writing, Tether has not replied to requests for an official confirmation of this news.
Tether (USDT) holds the record of being the first stablecoin in the crypto space. Also, the coin holds the largest market share amongst stablecoins. However, Tether has been one of the most controversial projects in the crypto space to date.
In July last year, a university study alleged that Tether had rigged crypto prices. Titled “Bitcoin Really Un-Tethered?” the study was the work of a finance professor at the University of Texas John Griffin and a graduate student named Amin Shams.
Following these allegations, the US DOJ and the CFTC launched a joint criminal investigation on the Tether in November 2018. This probe sought to find out whether Tether and Bitfinex were indeed guilty of manipulating bitcoin (BTC) prices.
A few months later in March 2019, Tether was back in the limelight for all the wrong reasons. This time around, the firm updated its terms and conditions, noting that its reserves contained other assets other than the US Dollar. Before this, Tether had maintained that the amount of USDT in circulation had a 1:1 backing ratio to the US Dollar. As a result of updating its terms and conditions, the NYAG office accused the company of stealing customer funds.
Per the NYAG office, Tether had partnered with Bitfinex in misappropriating customer funds to cover up losses. According to the accusation, these losses amounted to $850 million.
This news comes after Tether and Bitfinex and Tether replied to Judge Joel Cohen’s recent ruling. The ruling declared that NYAG had jurisdiction over Bitfinex. In their response, the partners noted that the NYAG’s claims did not have merit. They added that they would proceed to handle their issues in appeals court.
Before this crypto enthusiasts and shareholders had called for the delisting of USDT from leading exchanges. Reportedly, this public outcry came as a result of the Tether’s unending controversies.
Do you think Tether’s decision to launch CNHT will cause Chinese regulators to have a change of heart on their crypto stance? Let us know in the comments below.
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