{"id":182476,"date":"2023-10-10T11:39:50","date_gmt":"2023-10-10T11:39:50","guid":{"rendered":"https:\/\/precoinnews.com\/?p=182476"},"modified":"2023-10-10T11:39:50","modified_gmt":"2023-10-10T11:39:50","slug":"sbfs-alameda-minted-38b-usdt-to-profit-off-arbitrage-trading-coinbase-director","status":"publish","type":"post","link":"https:\/\/precoinnews.com\/crypto\/sbfs-alameda-minted-38b-usdt-to-profit-off-arbitrage-trading-coinbase-director\/","title":{"rendered":"SBF\u2019s Alameda minted $38B USDT to profit off arbitrage trading: Coinbase director"},"content":{"rendered":"

Blockchain data flagged by Coinbase director Conor Grogan indicates that Alameda Research redeemed over $38 billion for Tether (USDT) tokens in 2021 despite not having the equivalent assets under management.<\/p>\n

According to Grogan, the total value of USDT creation was higher than Alameda\u2019s total assets on its books at the height of the wider cryptocurrency market bull run in 2021.<\/p>\n

Grogan also suggests that FTX-ordered USDT redemptions were likely to have been from Alameda\u2019s tokens, totaling 3.9 billion USDT. The majority of this redemption amount was carried out during the collapse of Terra\u2019s algorithmic stablecoin.<\/p>\n

In January 2021, former Alameda co-CEO Sam Trabucco weighed in on prevailing reports of significant USDT mints carried out by Tether and gave inside insights into how Alameda profited off arbitrage opportunities relating to the value of USDT to various trading pairs across different exchanges.<\/p>\n

Trabucco described how the premium in which USDT trades to $1 was typically volatile, given that Bitcoin (BTC)-to-USDT trades resulted in a slight deficit in basis points when compared to BTC\/USD trades.<\/p>\n

\u201cAnd note, *these* are the best markets to use to determine where USDT is trading \u2014 the combo of BTC\/USDT and BTC\/USD markets, e.g., are WAY more liquid than any exchange\u2019s USDT\/USD market, so the prices from these (even though its a two-leg trade) matter way more.\u201d<\/p><\/blockquote>\n

Trabucco went on to explain that other United States dollar stablecoins like USD Coin (USDC) had a less volatile premium due to the creation and redemption process involved with USDT. Given that select firms have the ability to create and redeem USDT, most market players acquire and trade USDT from markets themselves and not directly from Tether\u2019s treasury.<\/p>\n

\u201cAnd when USDT gets above $1? A sophisticated firm like Alameda with great setups on all the exchanges and bots to execute more than one leg at a time is gonna want to sell! And we do \u2014 a LOT.\u201d<\/p><\/blockquote>\n

Trabucco added that Alameda was able to \u201csafely put on big bets\u201d due to its ability to do USDT creations and redemptions when it needed to. The former Alameda CEO described it as a \u201cwin-win\u201d situation for the trading firm and the stability of USDT\u2019s dollar peg:<\/p>\n

\u201cObviously we\u2019re making money because we can, e.g., selling above where we create, but we\u2019re also bringing the price in line so that when aggro buyers come in, it sticks close to $1.\u201d<\/p><\/blockquote>\n

As a result, Alameda profited by collecting the premium on arbitrage opportunities through its ability to create USDT tokens. Sam Bankman-Fried himself also chimed in on the debate in 2021, stating that Alameda actively redeemed USDT for U.S. dollars.<\/p>\n

Cointelegraph has reached out to Tether to confirm the amount of USDT tokens that had been minted at the request of Alameda.<\/p>\n

Magazine:<\/em><\/strong> The truth behind Cuba\u2019s Bitcoin revolution: An on-the-ground report<\/em><\/strong><\/p>\n

Source: Read Full Article<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Blockchain data flagged by Coinbase director Conor<\/p>\n","protected":false},"author":3,"featured_media":182475,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"yoast_head":"\nSBF\u2019s Alameda minted $38B USDT to profit off arbitrage trading: Coinbase director - Pre Coin News<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/precoinnews.com\/crypto\/sbfs-alameda-minted-38b-usdt-to-profit-off-arbitrage-trading-coinbase-director\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"SBF\u2019s Alameda minted $38B USDT to profit off arbitrage trading: Coinbase director - Pre Coin News\" \/>\n<meta property=\"og:description\" content=\"Blockchain data flagged by Coinbase director Conor\" \/>\n<meta property=\"og:url\" content=\"https:\/\/precoinnews.com\/crypto\/sbfs-alameda-minted-38b-usdt-to-profit-off-arbitrage-trading-coinbase-director\/\" \/>\n<meta property=\"og:site_name\" content=\"Pre Coin News\" \/>\n<meta property=\"article:published_time\" content=\"2023-10-10T11:39:50+00:00\" \/>\n<meta name=\"author\" content=\"mediabest\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:image\" content=\"https:\/\/precoinnews.com\/wp-content\/uploads\/2023\/10\/SBFs-Alameda-minted-38B-USDT-to-profit-off-arbitrage-trading-Coinbase-director.jpg\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"mediabest\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/precoinnews.com\/crypto\/sbfs-alameda-minted-38b-usdt-to-profit-off-arbitrage-trading-coinbase-director\/\",\"url\":\"https:\/\/precoinnews.com\/crypto\/sbfs-alameda-minted-38b-usdt-to-profit-off-arbitrage-trading-coinbase-director\/\",\"name\":\"SBF\u2019s Alameda minted $38B USDT to profit off arbitrage trading: Coinbase director - 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