Should investors lose confidence in the tether (USDT) stablecoin, it would bring a "severe liquidity shock" to bitcoin (EXANTE: Bitcoin), JPMorgan's analysts wrote in a recent report. The analysts note problems with access to USDT by both domestic and foreign investors most likely would result in a liquidity shock to the broader cryptocurrency market.
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According to the bank, the absence of an independent audit and deposit insurance makes the stablecoin one of the catalysts that could initiate volatility shocks on the market.
"Given this level of transparency, it is only natural that many in the cryptocurrency market have speculated about the long-term stability of the USDT peg," the analysts emphasize.
The bank CIO Hugo Rogers said the bank had an important investment in the benchmark crypto and had been investing clients' funds in the asset since the price of BTC amounted to $9,300.
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