Deutsche Bank’s report questioned the sustainability of stablecoins, which are digital currencies whose values are tied to traditional currencies such as the dollar. A past study indicated that only 14% of currency pegs engaged out successfully. They argue that stablecoins share similar vulnerabilities and predict widespread failures.
Tether did not agree with this story with the claim that the bank does not provide enough evidence to confirm its statement and they doubt the accuracy of the report’s approach.
Although Deutsche Bank highlights historical risk factors, Tether works towards that by strengthening trust and transparency. The stability of stablecoins is a key factor influencing their development and it is determined by their ability to control the peg during turbulence in the market.
The analysis by Deutsche Bank is very much disappointing because of Tether’s substantial market share. Although Tether denies the allegations, the stablecoin sector requires more transparent regulation.
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