Mistakes come in all shapes and forms, but not a lot of them are worth 5 billion USDT tokens. According to Whale Alert, Tether minted and later burned 5 billion USDT tokens.
Thanks to Whale Alert, this “small” mistake quickly spread like wildfire. Originally, Whale Alert was designed to help investors by reporting large and extremely large crypto transactions.
A suitable explanation for the account’s purpose would be the very large transaction of 50 million USDT tokens from the crypto exchange Poloniex to the Tether Treasury. The account reported that the transaction was done via the Omni protocol on the Bitcoin blockchain
Whale Alert users saw obvious money laundering
To further increase speculation and confusion, 50 million TRON-based USDT were finally transferred to a wallet that was said to belong to Poloniex. Many twitter users were quick to say that this was an obvious case of money laundering.
While preparing the issuance for Omni to Tron swap there have been an issue with the token decimals. Please check the burn transactions below @Tether_tohttps://t.co/reEW51qCqihttps://t.co/zo5i3ayTuQ https://t.co/h1Y9Mnr4Oq
— Paolo Ardoino (@paoloardoino) July 13, 2019
Paolo Ardoino, the CTO of Bitfinex and Tether, stated that mistake was made with the decimals. The original goal was to swap 50 million Omni-based USDT to the TRON blockchain.
Paolo is correct – this occurred while Poloniex was conducting a USDT chain swap with the help of Tether. An incorrect amount of USDT was accidentally minted, and this has since been resolved to the intended value.
— Poloniex Exchange (@Poloniex) July 14, 2019
Poloniex later confirmed Ardoino’s statement and the mistake became apparent.
This has definitely not been a very good week for Tether as Metropolitan Commercial Bank recently announced that it will shut down all accounts associated with the stablecoin.
Companies affiliated to Tether also had their accounts shut down. It was clarified that the request to close all accounts came from the bank itself, not iFinex, Digfinex or Tether.
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