Playing with fire, Tether looking to launch Chinese yuan-based stablecoin

Tether may be doubling down with a renmimbi product

Tether—with its sister company Bitfinex—may be in a heap of trouble in New York, but the stablecoin issuer is trying its hand at taking on another major currency: China’s yuan.

As reported in China-based ChainNews [translated from Chinese]:

“Bitfinex shareholder [RenrenBit founder] Zhao Dong confirmed to ChainNews that Tether will issue CNHT in the near future and anchor the stable currency of offshore renmimbi.”

Tether has had limited success with stablecoins outside of the U.S. dollar. Its EURt product has only 40 million euros worth of tokens outstanding; its JPYt hasn’t even launched yet. Meanwhile, its controversial—and troublesome—USDt has 4 billion tokens floating around. Two-thirds of all bitcoin trades are conducted against tether, according to data from CryptoComare.

The nature of the stablecoin issuer’s assets, of course, is the basis of New York Attorney General Letitia James’ suit against Tether, Bitfinex, and parent company iFinex. On Tuesday, a judge ruled James had jurisdiction to pursue a case claiming the companies had committed fraud against investors.

Tether Watch

Dovey Wan, a cofounder of San Francisco-based crypto investment firm called Primitive Ventures, weighed in on Twitter with some interesting insights. Besides noting that Bahamas-based Deltec will remain Tether’s bank in such a product, she doesn’t see adequate demand for a yuan-based Tether token and expects it to raise the ire of Chinese regulators:

She also sees conflict with the Chinese government’s reported attempts at building a digital version of the yuan:

And some Chinese crypto market players are calling for a boycott of CNHt even before it’s been officially announced, let alone launched:

Wan has become a most-follow on Crypto Twitter. Earlier this month, she made the argument that large market moves in Bitcoin over the past couple of weeks were related to the PlusToken scam. The full thread—worth the read—can be found here.

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Lawrence Lewitinn, CFA was the founding editor in chief of Modern Consensus. Disclosure: Lewitinn owns no cryptocurrencies in his portfolio.