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4 Feb 2026, 06:10

Tether Funding Collapse: Investor Fears Force $20 Billion Plan Abandonment

BitcoinWorld Tether Funding Collapse: Investor Fears Force $20 Billion Plan Abandonment In a stunning reversal that reveals deep investor apprehension, Tether Holdings Ltd. has completely abandoned its ambitious plan to raise $20 billion. The Financial Times reported this significant development on March 15, 2025, sending ripples through global cryptocurrency markets. This decision marks a pivotal moment for the world’s largest stablecoin issuer, forcing a strategic retreat to a much smaller $5 billion target after facing substantial resistance from potential backers. Tether Funding Plan Faces Investor Resistance The collapsed funding round would have valued Tether at an unprecedented $500 billion. However, investors expressed serious concerns about multiple risk factors. According to financial analysts familiar with the discussions, these concerns centered on three primary areas: Regulatory uncertainty surrounding stablecoin operations globally Trust questions about the stablecoin business model’s long-term viability Capital structure and risk exposure transparency issues Consequently, Tether’s leadership faced mounting pressure to reconsider their approach. The company’s Chief Technology Officer, Paolo Ardoino, acknowledged the shift in direction. He emphasized that Tether would adjust its investment strategy to better align with current market conditions and investor expectations. Stablecoin Market Context and Regulatory Landscape The Tether funding collapse occurs during a period of increased regulatory scrutiny for stablecoins worldwide. Major financial jurisdictions have implemented or proposed new frameworks for digital asset oversight. For instance, the European Union’s Markets in Crypto-Assets (MiCA) regulation now imposes strict requirements on stablecoin issuers. Similarly, the United States has advanced multiple legislative proposals that could reshape the industry. Recent Stablecoin Regulatory Developments Jurisdiction Regulatory Framework Implementation Timeline European Union MiCA Regulation Fully implemented 2024 United States Stablecoin Transparency Act Proposed 2024 United Kingdom Financial Services Act Amendments Phased implementation 2024-2025 Singapore Payment Services Act Updates Implemented 2023 These regulatory developments have created a more cautious investment environment. Investors now demand greater transparency and risk mitigation strategies from cryptocurrency companies. Furthermore, the stablecoin sector has faced increased competition from traditional financial institutions entering the digital asset space. Expert Analysis of Investor Concerns Financial analysts specializing in digital assets point to several specific investor worries. First, Tether’s reserve composition has historically attracted scrutiny from regulators and market observers. Second, the company’s profitability—reporting over $10 billion in profits last year—raises questions about sustainable growth models. Third, the broader cryptocurrency market’s volatility creates inherent risks for stablecoin operators. Market data from 2024 shows that stablecoin adoption continues growing despite regulatory challenges. The total market capitalization of stablecoins exceeded $180 billion by year-end. However, growth rates have moderated compared to previous years. This moderation reflects both market maturation and increased investor caution about potential systemic risks. Impact on Cryptocurrency Ecosystem Tether’s funding decision carries significant implications for the broader digital asset industry. As the issuer of USDT, the largest stablecoin by market capitalization, Tether plays a crucial role in cryptocurrency trading and liquidity. The company’s strategic choices influence market perceptions about stablecoin reliability and institutional adoption prospects. Several immediate effects have emerged since the funding plan collapse became public: Increased scrutiny of other stablecoin issuers’ funding plans Renewed discussions about reserve transparency standards Potential acceleration of central bank digital currency development Greater emphasis on regulatory compliance across the sector Market participants have noted that Tether’s experience may establish new precedents for cryptocurrency company valuations. The $500 billion target valuation represented an exceptionally ambitious benchmark. Its rejection by investors suggests more conservative approaches may dominate future funding rounds. Historical Context and Industry Evolution Tether’s current situation reflects the cryptocurrency industry’s ongoing maturation process. Early cryptocurrency companies often operated with minimal external funding. However, as the sector has grown, traditional investment mechanisms have become increasingly important. This evolution creates natural tensions between innovative business models and conventional investor expectations. The stablecoin sector specifically has undergone dramatic transformation since Tether launched USDT in 2014. Initially serving primarily as a trading vehicle on cryptocurrency exchanges, stablecoins now facilitate diverse applications including cross-border payments, decentralized finance protocols, and institutional settlement mechanisms. This expanded utility increases both opportunities and regulatory complexities. Conclusion Tether’s abandoned $20 billion funding plan represents a watershed moment for cryptocurrency investment. Investor pushback highlights growing concerns about stablecoin business models and regulatory risks. The company’s pivot to a smaller $5 billion target reflects necessary adjustments to current market realities. This development underscores the cryptocurrency industry’s continuing evolution toward greater transparency and institutional acceptance. As regulatory frameworks solidify worldwide, stablecoin issuers must balance innovation with investor expectations and compliance requirements. FAQs Q1: Why did Tether abandon its $20 billion funding plan? Investors expressed concerns about regulatory uncertainties, trust issues with the stablecoin model, and questions about Tether’s capital structure and risk exposure, leading to insufficient interest at the proposed valuation. Q2: What is Tether’s new funding target? Tether is now pursuing a significantly reduced funding round of approximately $5 billion, according to reports from the Financial Times and confirmed by company statements. Q3: How does this affect USDT stability and operations? Tether executives have stated the company’s financial position remains strong enough to operate without any external investment, suggesting minimal immediate impact on USDT stability or daily operations. Q4: What regulatory concerns influenced investor decisions? Investors cited evolving global regulations for stablecoins, including the EU’s MiCA framework and proposed US legislation, creating uncertainty about future compliance requirements and business model viability. Q5: How does Tether’s profitability relate to the funding decision? Despite reporting over $10 billion in profits last year, investors questioned the sustainability of this profitability given regulatory pressures and increasing competition in the stablecoin sector. This post Tether Funding Collapse: Investor Fears Force $20 Billion Plan Abandonment first appeared on BitcoinWorld .

4 Feb 2026, 06:00

‘Sell Gold, Buy Bitcoin’: Cathie Wood Makes The Rotation Call

ARK Invest CEO Cathie Wood said she would “make a shift from gold into Bitcoin” after gold’s run left the metal looking extended on a key liquidity-adjusted measure, arguing that bitcoin’s supply dynamics and long-term adoption case still favor the crypto asset despite a sluggish year. Speaking on a Feb. 2 episode of The Rundown interview, Wood framed the call as part of a broader “great acceleration” thesis laid out in ARK’s latest “Big Ideas” report, which expects AI-driven capital expenditure to surge and spill into robotics, energy storage, blockchain, and life sciences through what she described as converging S-curves. Sell Gold, Buy Bitcoin Now? Wood pushed back on the idea that bitcoin has “lost its mojo” as gold has outperformed in recent years, starting with a statistical point. “First thing you should know, Bitcoin and gold are not correlated. We did the analysis the correlation […] is as close to zero as you can get so no correlation,” she said, adding that in the last two market cycles, gold led bitcoin before the crypto asset caught up. Related Reading: Bitcoin Net Taker Volume Sees Third-Largest Bearish Spike In 2 Years Her more forceful warning was directed at gold’s positioning versus broad money. “You’ll find this […] a chart showing gold divided by M2. It has only been—it has never been higher. It hit a new all-time high this week,” Wood said, arguing the setup resembles historical extremes that coincided with very different macro regimes. “Gold is probably riding for a fall […] The last two times it was anywhere near this was in the massive inflation […] in the 70s early 80s and […] the Great Depression.” Wood said the stablecoin boom has absorbed some of bitcoin’s “emerging markets” transaction narrative, but she characterized that as a payments-layer substitution rather than a savings-layer replacement. “That’s just for the equivalent of a checking account. When they want real savings, they’re going to buy Bitcoin, we believe,” she said, tying the view to ARK’s long-term upside case. She referenced a bull-case target of $1.5 million by 2030 in the conversation, alongside the firm’s previously discussed seven-figure framework. Related Reading: 70% Bitcoin Crash Incoming? CryptoQuant CEO Says It Depends On This Her core comparative claim against gold centered on issuance. “The supply growth of Bitcoin is 0.8% per year and it’ll drop to 0.4 in another two years,” Wood said, contrasting it with gold supply growth she pegged at about 1% on average and suggesting mining output could run higher than bitcoin’s deterministic issuance rate. She also pointed to “intergenerational wealth transfer” as a potential tailwind for bitcoin over time. Wood also offered a more tactical explanation for why bitcoin has struggled to sustain upside momentum, pointing to what she described as an October 10 “flash crash” tied to a software glitch at Binance and an auto-deleveraging cascade. “There was a flash crash caused by a software glitch at Binance and there was an auto deleveraging event,” she said. “People were just […] margin called to the tune of about 28 billion dollars […] and we think that is just now washing through the system.” Because bitcoin is “the most liquid of all crypto assets,” Wood argued it becomes “the first margin call,” making it the primary source of forced selling during broad deleveraging. She suggested that overhang is now fading, but her comments came before Monday’s downdraft that saw bitcoin slide to $74,600. In the interview, she said the market was “testing […] around 80,000 again” and expected it to “hold in the 80 to 90,000 range” absent a major geopolitical shock. “Unless all hell breaks loose in Iran […] then maybe we’ll see the store of value come back for Bitcoin,” she added. At press time, BTC traded at $78,377. Featured image from YouTube, chart from TradingView.com

4 Feb 2026, 06:00

Bitcoin is down about 40% from its October peak

Bitcoin is on an epic crash right now, having lost 40% of its value since October, and Michael Burry (the investor behind the famous housing market short in 2008) is no warning that this dip could turn into a full-blown collapse. This guy is calling it a “death spiral.” Companies that loaded up on Bitcoin over the past year could be in serious trouble. In a post on Monday, Burry said Bitcoin is a speculative bet, not a real hedge like gold or silver. He pointed out that while precious metals soared on fears about the dollar, Bitcoin did nothing. And now, if it falls another 10%, he says Strategy, the biggest corporate holder of Bitcoin, would be deep in the red and could lose access to funding. He also said miners would be next to break. Price drop threatens companies and miners Bitcoin dropped under $73,000 on Tuesday, hitting its lowest level since Donald Trump returned to the White House in 2025. Some analysts blame the fall on weak flows, poor liquidity, and fading interest. Others say crypto traders are shifting toward betting markets instead of sticking with coins. But Burry thinks this isn’t just a blip . He said Bitcoin has no reason to stop falling. Even with adoption from corporate treasuries and new exchange-traded funds, the price hasn’t found support. He warned that nearly 200 public companies holding Bitcoin are now at risk. Once their accountants mark down those holdings, the pressure to sell will get worse. “There is no organic use case reason for Bitcoin to slow or stop its descent,” Burry wrote. And when Bitcoin keeps dropping, he said CFOs will tell their teams to get out. Treasuries aren’t long-term bets. They get marked to market. When Bitcoin tanks, it hits financial reports directly. Burry said risk managers won’t sit around and hope. They’ll cut. He also pointed to the surge in spot Bitcoin ETFs. Instead of helping, he says they’ve made Bitcoin even more speculative. He said the ETFs have raised Bitcoin’s ties to the stock market, and the coin’s correlation with the S&P 500 has now reached around 0.50. That means if stocks fall, Bitcoin could fall harder. Outflows, tokenized metals and growing damage Burry noted that ETFs have seen some of their worst daily outflows since November. Three big ones happened just in the last ten days of January. That’s not small money leaving. It’s investors giving up. He also said crypto is leaking into other markets. Even though Bitcoin’s market cap is under $1.5 trillion, and household exposure is low, the impact is spreading. To cover losses, traders are dumping other assets, especially tokenized gold and silver futures. Those contracts aren’t backed by real metal. When they get sold off in bulk, they pull down the real metals market too. Burry said this creates what he called a “collateral death spiral.” At the end of last month, he estimated that up to $1 billion in precious metals was liquidated just because of falling crypto prices. If Bitcoin falls to $50,000, Burry said miners would go broke and tokenized futures would crash with no one left to buy them. He blamed recent losses in gold and silver directly on crypto-linked selling. “Sickening scenarios have now come within reach,” he wrote . The smartest crypto minds already read our newsletter. Want in? Join them .

4 Feb 2026, 05:45

Big Short’s Michael Burry Says Bitcoin’s Drop Risks Cross-Market Fallout

Michael Burry, the hedge fund manager known for calling the 2008 housing crash, warned in a recent Substack post that bitcoin’s decline could trigger a “true death spiral,” spilling into gold, silver and other interconnected markets. Legendary Investor Michael Burry Speaks of ‘Death Spirals’ and ‘Black Holes’ In his Feb. 2, 2026, post, dubbed “Short

4 Feb 2026, 05:35

Stephen Miran resigned from the White House Council of Economic Advisers

Federal Reserve Governor Stephen Miran has officially resigned from his role as Chair of the White House Council of Economic Advisers (CEA) to focus fully on his duties at the Federal Reserve Board of Governors, underscoring a controversial chapter in U.S. central‑bank and executive‑branch relations. In a resignation letter dated Tuesday, Miran said he was keeping a pledge he made to the U.S. Senate during his confirmation process, that he would leave his White House post if his service at the Fed extended beyond the temporary term originally assigned to him. Miran had taken unpaid leave from his CEA role after being confirmed by the Senate last September to fill a short‑term vacancy on the Fed’s Board of Governors left by former governor Adriana Kugler. His term formally expired at the end of January, but under federal law, he may remain in the position until a Senate‑confirmed successor takes office. In his resignation letter to Trump, Miran stated that, “In accordance with the Federal Reserve Act, members of the Board of Governors must be committed full-time to their roles. Although I took an unpaid leave from the Council to join the Federal Reserve, I assured the Senate that if I remained on the Board after January, I would officially resign from the Council.” Miran plays a crucial role in Trump’s administration Concerning his decision to resign, Miran expressed his belief that it is important for him to fulfill his pledge while he focuses on executing his duties at the Federal Reserve. According to him, he submitted his resignation with a heavy yet proud heart. Meanwhile, sources revealed that the White House initially announced his departure. This was after White House spokesman Kush Desai shared a statement to the public alleging that, “Following his commitment made to the Senate during his confirmation for the Federal Reserve’s Board of Governors, Stephen Miran has resigned from the Council of Economic Advisers.” Afterwards, he made remarks regarding Miran’s time in office. Desai acknowledged that the Federal Reserve official’s insightful contributions and dedicated support for Trump made him an invaluable asset to the White House. Apart from this finding, the spokesperson also noted that Miran played a key role in the Trump administration’s economic team . Meanwhile, it is worth noting that Miran’s resignation comes as the US president is actively reshaping the Federal Reserve. While this was taking place, reports dated Friday, January 30, stated that Trump appointed Kevin Warsh, a Financier and former Member of the Federal Reserve Board of Governors of the United States, as Federal Reserve Chair Jerome Powell’s successor during an ongoing criminal investigation. Thom Tillis calls on the Trump administration to resolve Powell’s criminal scrutiny As of January 11 this year, Powell publicly stated that the Justice Department had initiated a criminal investigation into his testimony before Congress concerning the central bank’s two historic primary buildings renovations on Washington, D.C.’s National Mall. In the meantime, sources warned that Warsh’s appointment to chair the prominent monetary authority faces potential setbacks amid opposition from Republican members concerning Powell’s investigation. On the other hand, Thom Tillis, the senior United States senator from North Carolina, claimed that he will hold up any Fed board nominations until the criminal investigation into Powell is resolved. Tillis’s position on the Senate Banking Committee makes his stance particularly significant. Don’t just read crypto news. Understand it. Subscribe to our newsletter. It's free .

4 Feb 2026, 05:34

American ‘Big Short’ Investor Michael Burry Warns of $1B Precious Metals Catastrophe if Bitcoin Keeps Slipping

Michael Burry, the legendary investor behind “The Big Short,” has predicted that Bitcoin’s deepening bear market could trigger a $1 billion impending catastrophic sell-off in gold and silver. “It looks like up to $1 billion in precious metals were liquidated at month’s very end as a result of falling crypto prices,” Burry said. In a Substack post on Monday, he argued that Bitcoin has been projected as a purely speculative asset. Further, the crypto correlation with precious metals has created what Michael Burry calls as “sickening scenarios” that have now come within reach. BITCOIN SLIDE COULD WIPE OUT COMPANIES Michael Burry warned that Bitcoin’s ongoing decline could destroy significant value, especially for companies holding large BTC reserves. He said Bitcoin has failed as a safe haven like gold and could push aggressive corporate holders into… — *Walter Bloomberg (@DeItaone) February 3, 2026 Bitcoin has slipped 3.17% over the past 24 hours, extending a 14.44% weekly drop amid a broader crypto market decline. The largest crypto by market cap is trading at $76,362 in the Asian morning hours on Wednesday. Michael Burry’s predictions coincided with Bitcoin hitting $72.8K lows. That said, high-profile bearish narratives can accelerate capital rotation out of risk assets. With BTC already down 17.74% monthly, such warnings reinforce negative sentiment and discourage dip-buying. Saylor’s Strategy Exemplifies Institutional Risk: Michael Burry Per a Bloomberg report on Wednesday, Burry further warned that if Bitcoin tumbles another 10%, Michael Saylor’s Strategy, the largest corporate BTC treasury firm with 713,502 Bitcoin stash as of Monday, would likely record millions in losses. Strategy sees an “existential crisis” if BTC were to fall to $60,000. This would “find capital markets essentially closed,” Burry added. Other BTC hoarders would likely take a 15%-20% loss on their holdings, leading risk managers to “get more aggressive,” Michael Burry said. Strategy has turned unprofitable following Bitcoin’s slump, facing an unrealized loss of over $900 million , as reported by Cryptonews early this week. Despite the coin plummeting below $75K, the company accumulated additional 855 BTC on Monday. If BTC Continues to Fall, Risk Managers Will Advice Companies to Sell According to Michael Burry, there is no organic use case reason for Bitcoin to slow or stop its descent. Unlike silver or gold, the crypto has indeed failed to respond to drivers, including geopolitical risks. BTC treasury firms and spot crypto ETFs are not enough to keep its price afloat. Nearly 200 public companies hold Bitcoin, Burry said. “There is nothing permanent about treasury assets.” “Bitcoin ETFs have been notching some of their biggest single-day outflows since late November, with three of them occurring in the last 10 days of January,” Michael Burry wrote. He further warned that if the crypto’s price keeps falling, company risk managers will start advising to sell their Bitcoin stash. The post American ‘Big Short’ Investor Michael Burry Warns of $1B Precious Metals Catastrophe if Bitcoin Keeps Slipping appeared first on Cryptonews .