Kraken Responds to Bloomberg Allegations By Revealing Bitcoin Market Manipulation Agenda
Multinational cryptocurrency exchange, Kraken, recently reacted to Bloomberg’s article claiming that manipulations have taken place with Tether, a cryptocurrency backed by traditional currencies. Kraken infers that the purpose of the article aims to affect future trading prices.
Kraken Strikes Back at Bloomberg
According to multiple reporters in association with Bloomberg, data derived from USDT trading on the 29th of June from the Kraken network reportedly resulted in two regulator red flags. In response, Kraken released a statement declaring their article was illogical and poorly written. In addition, Kraken clarified that when it comes to market manipulation in the press, Bloomberg clearly has an agenda of their own.
The crypto exchange commented on the semantics of the article, explaining that the 29th of June marked the end of Q2 trading, a significant and premeditated date to release such an article.
Kraken was presumably discussing the end to futures trading agreements with Chicago Mercantile Exchange which happened to conclude on the 29th. In other words, an agreement between traders on a set price from which an asset will be sold between them place a gamble on whether or not values will rise or fall in the future.
Kraken made note that this article could have an effect on the Bitcoin values dropping, allowing those who predicted it to fall short in profit.
Reacting to Claims Of Tether Manipulation
The article published by Bloomberg presented two claims against Kraken’s Tether trading based on data derived from Kraken itself. It suggested that several smaller trades had a bigger impact in the total price of USTD than trades of higher values. It also highlighted the fact that a major percent of trades were placed with a very specific order size, deeming it unlikely to have been placed by real people.
The article went on to explain the major difference between Bitcoin and Tether, and that unlike the typical fluctuations seen in the value of Bitcoin, Tether has a less consistent change brought on by the size of orders, be it small or large.
In response to the initial allegation, Kraken stated that the key difference between Bitcoin and Tether is that it is backed entirely by dollars rather than merely influenced by demand.
As for the second accusation referring to smaller trades and highly specific order sizes, Kraken took a humble approach expressing that the company isn’t quite large enough to confirm a price for USDT. In order to establish such price discovery, exchanges would need to take place on markets carrying mass amounts of dollars in volume, rather than Kraken’s Tether/USD market trading just under a million based on recent counts.
According to Bloomberg’s research, 7.9 percent of trades occurring between 1st of May through to 22nd June were linked to an individual trader who placed orders amounting to 13076.389 worth of Tether. The individual explained to Kraken that the figure was merely a random selection.