Stablecoin, Tether is breaking into the Chinse market and is planning to create a token pegged to the offshore Chinese fiat currency Renminbi (RMB/CNY), called “CNHT”.
The shocking news came from Bitfinex Shareholder, Zhao Dong, who posted on Weibo, the Chinese answer to Twitter. Dong would be in the know as Bitfinex is also under the same parent company as Tether, which is called iFinex Inc.
In his statement, Dong, who is also the founder of the digital asset management platform RenrenBit, claimed his company would be one of the first to invest and expressed his excitement in the project.
Although Tether is yet to confirm these rumors, Etherscan research has suggested that the company, who is pegged to the US dollar, has been working on a Chinese variant since April of this year. Etherscan believes the token has a total supply of 10,000,000 CNHT kept in a single smart contract address.
Implications and likelihood for CNHT
Perhaps emboldened by the news that the People’s Bank of China’s (PBoC) decision to create their own cryptocurrency, clearly Tether has seen an opening within which to tap into the second-largest economy in the world. However, what prompted them may actually become their downfall, as the group could struggle to get regulatory approval.
Even if Tether was not a possible competition for the Chinese government-backed cryptocurrency, their track record may also be a sticking point for regulatory approval.
Tether has never shied away from controversy. Price manipulation, the burning of 500 million USDT in 2018 are just a couple of major scandals. They were also shown to not be 100% backed by the US dollar in yet another PR disaster. Currently, parent company IFinex is under investigation from the NY attorney generals office.
Yet, what could be a piece of good news is the popularity of Tether for the Chinese market. Asia Crypto Today has reported extensively on the reliance and importance of the Chinese market for Tether’s USDT token. Chinese investors have reportedly bought over 30 million in Tether tokens in Russia. Not only that, but the Chinese market accounts for over 60% of USDT trading.
