Bitcoin Surcharge on Bitfinex and USDT Pairs Building FUD in Traders?

By Nivesh Rustgi
Published April 29, 2019 Updated April 30, 2019
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Bitcoin Surcharge on Bitfinex and USDT Pairs Building FUD in Traders?

By Nivesh Rustgi
Published April 29, 2019 Updated April 30, 2019

Bitfinex was found in 2012 in Hong Kong; moreover, after the Mt. Gox hack, it became the leading Cryptocurrency Exchange in the world in 2015. Recently, it was accused of falsifying records and covering up lost funds to the tune of $850 million.


Many suspicious activities have been recorded on Bitfinex post the court case with more than $185 million moved from its Bitcoin and Ethereum Cold Wallets. Furthermore, since the issue is directly linked to USDT and USDT is, in fact, the base trading pair at many Exchanges, are all charging a ‘Bitfinex Premium.’

Bitfinex Premium

It is a term coined to account for the excess in the price of Bitcoin compared to other Exchanges and portals than at Bitfinex, and specifically USDT based Exchanges. On 28th and early 29th April, the BTC/USDT pairs were reporting a Bitfinex premium of $250-$300 as noted by Mati Greenspan, the Senior Market Analyst at eToro. He added in his crypto-mailer,

“Astonishingly, Tether’s peg to the US Dollar is holding up incredibly well dropping a total of two cents on the entire drama from $1.01 to $0.99.”

At the time of reporting, the price of Bitcoin at Bitfinex was $5392. While the price at Coinbase and Binance $5125 and $5118 respectively. Hence, the Bitfinex Premium at 13: 15 hours UTC on 29th April is $272. Statistically, a deviation of such large scale implies abnormal activity. Interestingly, the price of BTC/USDT pair on Binance is $5245.

As the news broke, most of the Exchanges reported losses to the tune of 7-10% on Bitcoin. Moreover, the accused Exchange led the recovery as well; the price on Bitfinex recovered faster and even came with an added premium.

WhalePanda, a research and chart analyst noted that,

With a large amount of coins being withdrawn from Bitfinex and more shorts being opened the funding rates on Bitfinex are currently near a 36-40% pa return (or 0.1% daily return) for Bitcoin.

Furthermore, it is primarily causing two things now, it is deterring buy orders due to the premium and also people who are risking buying USDT as the price is higher from Bitfinex are increasing the volume of USDT. Moreover, it has also created an opportune arbitrage opportunity of Bitcoin traders on Bitfinex and other Exchanges. As noted earlier, the price of BTC/USDT pair on Binance is $5245.

It is Not Over Yet, Bitcoin Under Deep FUD (Fear, Uncertainty, and Doubt)

Currently, there are only five Bitcoin wallets in the world with more than a 100,000 Bitcoins. Bitfinex is one of them which is ranked 5th with a total value of approx. $535 million (this is after the 17k Bitcoins that were moved from the Exchange’s cold wallet on 26th April).

3D2oetdNuZUqQHPJmcMDDHYoqkyNVsFk9r: This is the public address to the Bitfinex cold wallet.

Bitfinex Cold Wallet
Bitfinex Cold Wallet Balance (Bitinfo)

Furthermore, all the top addresses still belong to top Exchanges like BitStamp, Binance, Huobi, and Bittrex. Hence, if the charges on Bitfinex are confirmed, another crypto-heist of about a billion dollars is forthcoming.

Also Read: Does NY Attorney General Have a Strong Case Against Bitfinex? New Reports Come To Light

B.Biddles, a chart analyst tweeted that, the fact that the New York Attorney-General has filed the case, it will attract a lot of criticism and probably disrupt the market in the short term.

‘Im staying out of the market for now. If we pump, I’ll short. This $USDT thing isn’t over yet… We just have to get past the big boss first.. before the next bull run imo’

However, he also noted that Bitfinex news might have just provided the correction we need to continue the bull run. However, a big move on the upside during apprehensive market psychology would also increase the probability of a bull trap.

Which way do you think the market will head now? Please share your views with us. 

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Nivesh Rustgi
1181 Articles
Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)

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