Co-Founder Of Tether Quits To Join Stablecoin Clearinghouse Project

Tether (USDT) co-founder and former Chief Strategy Officer of Bitfinex, Phillip Potter has recently joined the advisory board of a new stablecoin project, is a nascent stablecoin clearing house project, currently being developed by crypto finance company XBTO. Its objective is to act as a central clearing counterparty (CCP) for stablecoins — a type of crypto asset designed to experience less price volatility, either by being notionally fiat-collateralized or via an algorithmic peg.

Initially, the main goal of this new initiative is to improve the stability, liquidity and the accessibility of the most important stablecoins which are being sold in the market right now like USDT, GUSD, PAX, TUSD, USDC and DAI etc. This way, stablecoins can reach users in a more mainstream way, as the main goal of the company is to help this specific type of crypto to reach mass adoption.  Its revenue will be generated by charging a fixed fee from the investors for its functions.

XBTO founder and CEO Philippe Bekhazi is set to serve as interim CEO for the new project. Potter will be accompanied by Samson Mow — CSO at Blockstream —  and David Namdar, founding partner of Galaxy Digital (which he has since left) and SolidX Partners in the advisory board. While commenting on the launch, Bekhazi said:

“The stablecoin market at the moment is inefficient and has various disparate stablecoins, with users needing to transact several times with different parties to exchange one stablecoin for another.

At first, the clearinghouse will be set in Bermuda, which has positive legislation, but the company is still on the way to receive a business license from the Bermuda Monetary Authority. At the moment, it is not still clear when the clearinghouse will finally be launched officially.

Potter’s expertise derives from two of the most stalwart — if controversial — companies in the field.

Both Bitfinex and Tether — which share a CEO — received subpoenas from United States regulators for undisclosed reasons back in December 2017, which commentators related to insistent doubt over Tether’s claims that USDT is backed 1:1 by the U.S. dollar.

Suspicions increased when Tether decided to dissolve its relationship with a third-party auditor last January, and subsequently releasing an unofficial audit in an attempt to resolve several issues. Tether has also faced banking difficulties, and both firms have been subject to an investigation into alleged market manipulation by the U.S. Department of Justice.

Bitfinex has faced its own separate share of controversies as well as trials with banking relationships in recent years, and was prompted to refute rumors of insolvency in October 2018.