TL;DR: San Franciso-based cryptocurrency exchange Kraken CEO, Jesse Powell, recently gave his views on theories surrounding bitcoin core’s (BTC) price runup. He denied most experts’ pet explanation Tether (USDT) had much to do with it, and further explained his being relatively unbothered by the New York Attorney General’s (NYAG) investigation of the stablecoin, insisting also how the NYAG does not oversee his company.
Kraken CEO: Tether Prints = Result of New Fiat
On 1 July 2019, Powell explained his position on controversies regarding USDT and its role in speculative markets regarding BTC especially. Speaking with TD Ameritrade’s lead anchor, Oliver Renick, Powell asserted USDT was a “transparent” reflection of the US government’s printing of new dollars.
Prior to that discussion, Powell told Renick Kraken successfully raised more than $13 million during a round shooting for just $10 million, and also revealed that money was already allocated to “acquisitions.” Putting aside private equity markets and traditional public offerings, Kraken chose the crowdfunding route as a way to “democratize” the process and “bring more clients in” to the company’s orbit. More than 2,000 elected to do just that, according to Powell.
Turning to the widely labeled present bull run, Renick asked about its cause as Powell saw it. The always candid CEO agreed the cryptocurrency market was simply experiencing another run followed by a crash. He said the market was “very cyclical” and that people in his position “see this over and over again.” Powell warned against day trading and suggested thinking longer term is perhaps a more prudent play.
Powell also lamented a lack of “regulatory clarity” as the main reason BTC hasn’t fully broken out in price the way perma-bulls have anticipated. He pointed to the regulation environment in New York, for example, calling it an “immense failure.” Renick then turned to the New York Attorney General’s moves against Tether, asking whether USDT was legitimate. Powell answered the history of USDT on Kraken matched the volume of US fiat on his exchange, and probably that of others as well. As to whether the BTC price is being gamed, Powell insisted he was unconcerned, as on his exchange USDT is paired only with dollars. “I don’t feel like Tether is artificially inflating the price of bitcoin,” Powell doubled-down. “I think Tether is actually a small part of the total fiat supply among all the exchanges.” He said it was new users and new dollars driving up the price.
DISCLOSURE: The author holds cryptocurrency as part of his financial portfolio, including BCH.
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