EUR/USDT Rate far from Market rate in Forex markets

This question has been asked before but has not been answered satisfactorily in my opinion. While the USD/USDT rate is very close to 0.9998 to 1.0002 the rate for EUR/USDT varies greatly and is far away from market rate. At time of writing, July 14th, 2021 – the rate on Binance to buy EUR with USDT is 1.1643 while the market rate 1.1801. This is a 1.4% difference. This simply makes it inefficient to trade back to your FIAT currency and that has implications for many customers in Europe. Can someone explain this level of difference? (previous responses were about weekend … today is a Wednesday and all markets are open).

What do you think?

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  1. Hmm yes this is very interesting. I have been following BUSD/EUR market for some time. I think this has to do with Binances specific situation. As Binances is its own market place.

    Recently withdrawals of EURO have been suspended due to the UK situation so this means that all the people who are getting EURO off of Binance now need to sell their EURO on the market instead of just withdrawing EURO so this means there is a higher than usual SELL pressure on EURO making the price of euro go down.

    Normally when such a price difference happens arbitrage causes the price to go back to normal rates. Arbitrage on this situation would be people who see that EUR can be bought cheap on Binance so they buy EURO and withdraw it and then use that money to to fund more dollar deposits and use that to buy more cheap euro and so on so they earn money from the price difference until the price difference goes back close to 0. This isn’t possible now because the only way to withdraw EURO cheaply now is to trade it for other currency so EURO in binance Will keep going lower and lower until a point.

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