Tether addresses depeg fears as Binance.US faces 8% Bitcoin discount
Binance.US has experienced huge price swings with its US dollar pairs since the SEC filed a lawsuit against it.
Bitcoin (BTC) and other digital assets, including Tether (USDT), are currently trading at an 8% discount on Binance.US, a situation attributed to liquidity issues on the platform following a lawsuit filed by the U.S. Securities and Exchange Commission (SEC).
Data from Binance.US shows that BTC is trading at $27,705.59 at the time of writing, around $3000 less than it sells on rival platforms like Coinbase, Kraken, BitStamp, and others.
Binance US troubles
Since the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Binance.US on June 5, the exchange’s market depth has fallen by almost 80% as market makers exited the platform.
Following the legal troubles, the exchange discontinued U.S. dollar deposits after its banking partners abruptly halted their payment channels and transitioned to a crypto-only platform. Blockchain analytical firm Kaiko reported that this issue greatly affected Binance.US’ reputation, and its market share fell to less than 1%.
Meanwhile, assets paired with stablecoins like USDT and USDC are trading at regular prices, according to data from Coingecko.
Tether CTO addresses USDT trading on Binance.US
Tether CTO Paolo Ardoino addressed concerns that USDT had deviated from its dollar peg. He highlighted that the deviation is exclusive to Binance.US, where a general -8% spread appears to affect all cryptocurrencies on the platform.
According to Ardoino, the situation was caused by the legal challenges Binance.US was currently facing. He wrote:
“Binance.US is going through some legal challenges so it probably doesn’t have many market makers willing to arbitrage at this moment in time. On Binance.com USDt is trading 1bps above the dollar.”
The Tether CTO further added: