Studies have found little correlation between tether printing and bitcoin price

Studies have found little correlation between tether printing and bitcoin price

In recent months, there has been a lot of talk on the channels dedicated to the tether digital bitcoin and whether or not it is correlated with the dollar. There are skeptics, speculators, Twitter users and well-established reports claiming that tether printing has had a significant effect on the bitcoin price in the past year.
A doctoral student at the University of Groningen analyzed security and discovered that it is unlikely that new tether chips fed into the system have made the price rise unjustifiably.

Statistics do not show that the bitcoin would have been pumped by tether

Two days ago, Oleksandr Ivanov, a data analyst at the University of Groningen, published a statistical view that explores the theory that the bitcoin would have been pumped by tether printing. Many believe that the fact that new tether pointers have been printed has increased the significant bituminous value. It was said that last year the phenomenal increase in bitcoin was caused by tether.

A studio called the “Tether Report” says that when the USDT was printed, the bitcoin price went into higher speed “two hours after the allocation of 91 tether scholarships to the Bitfinex wallets.” Even if some believe that the two coins are linked, Ivanov says that this correlation is “in any case pretty close to zero”.

“We have approached the issue statistically. If the alleged tether strategy is true, we should see a positive correlation between changing the tether number and changing the bitcoin price in close-up graphs, “explains Ivanov’s analysis.

Historical bitcoin price data and tether number in 2017, then bitcoin price changes

Daily change in market share for tether

Ivanov used the bitter history of Coinmarketcap and the number of tether chips in 2017. Then he calculated the daily percentage change and daily changes in the number of existing tethers.

Then we printed the daily bit rate changes compared to the percentage of newly-released tethers. Most points approach zero. Some of the points in the right corner correspond to the large percentage changes associated with the tether number. There are marginal points. Interestingly, they are largely below zero on the bituminous price axis, “Ivanov explains in his analysis.

The Pearson correlation coefficient for daily changes in the bitcoin price and the number of tethers emitted is -0.17168 (a significant p value would have been 0.001). So, we have a negative correlation between tether printing and bitcoin price changes.

The researcher then studies whether new tethers are used to pump bitcoin prices over a longer period of time.

“In each case, the correlation is still close to zero,” concludes the paper. His tests do not support the idea that the bitcoin price moves in tandem with tether printing, although as Ivanov explains, his statistical analysis does not totally remove the idea that tether has manipulated the market.

A transparent public audit done at the tether will light up this issue,” Ivanov says.

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