UPDATE (10/15, 7:50 PM EST): Representatives from Tether have released a statement, attributed to chief compliance officer Leonardo Real. The statement comes hours after the USDT price fell below its peg to hit a low of $0.92 Monday morning and, later, temporarily rose back to $1 per token.

As of press time, USDT is trading for roughly $0.95 on Kraken.

Real was quoted as saying:

“Tether is the leading provider of tokenized fiat currencies and is listed on many exchanges worldwide. We would like to reiterate that although markets have shown temporary fluctuations in price, all USDT in circulation are sufficiently backed by U.S. dollars (USD) and that assets have always exceeded liabilities. In June 2018, a report from Freeh Sporkin & Sullivan, LLP (FSS), based on a random date balance inspection and a full review of relevant documentation of bank accounts, confirmed that all Tethers in circulation as of that date were indeed fully backed by USD reserves.”

The price of the tether stablecoin (USDT) has fallen to an 18-month low Monday, despite a general rise in the wider crypto markets.

The tether-US dollar exchange rate (USDT/USD) fell to $0.925284 at 07:00 UTC – the lowest level since April 27, 2017 – and was last seen trading at $0.967296, representing a 2 percent drop on a 24-hour basis, according to CoinMarketCap.

The slide in the USDT price has pushed up the premium carried by bitcoin (BTC) prices on the Bitfinex exchange above $600.

As of writing, bitcoin is trading at an average of $6,617 across global exchanges, according to CoinDesk’s Bitcoin Price Index (BPI), having clocked a 5.5-week high of $6,960 earlier today.

However, on Bitfinex, BTC is changing hands at $7,055, meaning prices are trading at a premium of $438 to the BPI. The leading cryptocurrency rose as high as $7,788 on Bitfinex, which operates Tether LLC, the firm that developed the USDT token.

Some reports are putting the price drop down to traders losing faith in the token, amid claimed lack of transparency over tether’s true USD holdings and rumored issues at partner firm Bitfinex.

Interestingly, other recently introduced stablecoins like Gemini Dollar (GUSD) and TrueUSD (TUSD) are up 1.85 percent and 4.96 percent, respectively.

Whatever the reason for the drop, it seems safe to say that traders have likely rotated money out of USDT and into bitcoin and other stablecoins.

Disclosure: The author holds no cryptocurrency assets at the time of writing.

Traders via CoinDesk archives; charts by Trading View