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U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

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Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

#131

Post by krapp »

jandrese wrote: post #85
brokensegue wrote: post #78

Earlier quoted context omitted.

For a different perspective, I would say their problem is integration with the "real world" with constrains that bitcoin wasn't designed for.

What use is a currency (or commodity!) that you can't convert into a good or service? It seems like a fundamental problem if the theoretical advantages of a currency are lost the instant you try to use it to buy something. Otherwise we're just wasting gigawatts of electricity to print Monopoly money.

The assumption has always been that cryptocurrency driven markets would emerge completely decoupled from states and their systems of financial regulation, and so conversion would be neither necessary, nor desired. Everything you could possibly want to buy, legal or illegal, would be payable through the crypto market. Cryptocurrencies were supposed to undermine fiat, or at least render it unnecessary, barring taxes, not cooperate with it.

Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

#132

Post by onewhonknocks »

g09980 wrote: post #129
onewhonknocks wrote: post #125

They updated the article several hours later with: 'The U.S. Commodity Futures Trading Commission sent subpoenas on Dec. 6 to virtual-currency venue Bitfinex and Tether, a company that issues a widely traded coin and claims it’s pegged to the dollar, according to a person familiar with the matter, who asked not to be identified discussing private information.'

This should be much more visible. The market is panic selling on effectively old news.

Agreed. Thank you for saying so. edit: is there a way to bold text in an HN comment?

Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

#133

Post by dragonwriter »

ThrustVectoring wrote: post #120
dragonwriter wrote: post #112

Earlier quoted context omitted.

> If USDT goes to zero, every exchange that trades it becomes immediately insolvent. Nope. They'd only be insolvent if they had a legal binding commitment to redeem USDT 1:1 in dollars, and only if they didn't have sufficient other USD reserves to do so.

The exchanges get sued by the Tether bagholders, and everyone else gets spooked and attempts to exit. So not insolvent, but no active business activities and a bunch of lawsuits incoming, and might as well be insolvent.

> The exchanges get sued by the Tether bagholders

On what basis? Other than ones that commingle USD and USDT and/or are organizationally associated with Tether (which, I think, is mostly Bitfinex and Bitfinex), I'm not seeing where there is much basis for holding the exchange liable for the collapse in value of a traded asset.

Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

#134

Post by darawk »

spookthesunset wrote: post #105
andrewla wrote: post #88

Earlier quoted context omitted.

You can exchange USDT for fiat, on demand, for exactly 1 USD/USDT, but only at Bitfinex. For bank wires, they charge a .1% fee, so technically I guess 0.999 USD for each 1 USDT. For verified customers, there is no withdrawal limit. Kraken offers a USD/USDT market that allows you to obtain fiat for your USDT, and the price stays fairly stable but the liquidity is low (thus slippage is high). It's currently trading at…

> You can exchange USDT for fiat, on demand, for exactly 1 USD/USDT, but only at Bitfinex My understanding is this isn't the case. My understanding is Bitfinex will take your USD and convert to USDT which you can then use to buy crypto. But it won't take your USDT and turn it back into dollars. In fact, my understanding is the only way to turn USDT back into USD is either directly through Kraken or indirectly through…

No, you can convert USDT directly to USD. However, Bitfinex can only wire you that USD to a Taiwanese bank account. I can't verify that they actually will wire it, but this is what they claim. And I assume if they were refusing to make these wires to people who had Taiwanese bank accounts, people would be pointing it out.

Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

#135

Post by sxates »

jhwang5 wrote: post #118
sxates wrote: post #99

I'm not saying that there's nothing worth investigating in the Crypto space, but I wish the SEC spent half the time it spends chasing down shady ICOs looking into fraud at Goldman Sachs and other Wall St. banks. You know, the institutions that whose scale dwarfs crypto and actually has enormous economic repercussions?

They do go after Wall St. banks - what makes you think SEC doesn't?

Just looking at the last 6 months of press releases, I can't find a big bank anywhere.

https://www.sec.gov/news/pressreleases

Then there was that time back in 2008 when all these banks crashed our economy and a single guy was prosecuted and went to jail. 1 guy.

But in the last month I can remember at least 3 press releases from the SEC about crypto concerns and investigations.

Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

#136

Post by spookthesunset »

gruez wrote: post #123
spookthesunset wrote: post #105

Earlier quoted context omitted.

> You can exchange USDT for fiat, on demand, for exactly 1 USD/USDT, but only at Bitfinex My understanding is this isn't the case. My understanding is Bitfinex will take your USD and convert to USDT which you can then use to buy crypto. But it won't take your USDT and turn it back into dollars. In fact, my understanding is the only way to turn USDT back into USD is either directly through Kraken or indirectly through…

> But it won't take your USDT and turn it back into dollars. that's... unlikely. mainly because if that were true, nobody would want to sell anything at bitfinex, and cryptocurrency prices there would skyrocket. this happened at mtgox when they halted withdraws, BTC prices skyrocketed there.

Has anybody here on HN been able to go $ANYTHING -> USD on Bitfinex?

I haven't seen anybody anywhere claim they've gotten USD out of Bitfinex...

Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

#137

Post by mitchellberry »

moduspol wrote: post #124
machinecontrol wrote: post #19

Earlier quoted context omitted.

If USDT goes to zero, every exchange that trades it becomes immediately insolvent.

Exchanges don't actually hold the things they're trading. They're just matchmakers who take a percentage when trades occur. Anything creating high volume benefits exchanges, even if that volume is everyone trying to sell their tethers for other crypto.

>Exchanges don't actually hold the things they're trading.

Bitfinex has a few billion in publicly known cold wallets.

Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

#138

Post by darawk »

So, to those who are skeptical of Tether...you know that you can convert Tether 1:1 for USD by depositing it at Bitfinex, right? They'll then wire you that USD to any Taiwanese bank account[1] (the only banks that haven't frozen their wires). AFAIK, there are no reports from Taiwanese account holders of trouble with these wires.

[1] - https://www.bitfinex.com/posts/203

Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

#139

Post by dragonwriter »

g09980 wrote: post #129
onewhonknocks wrote: post #125

They updated the article several hours later with: 'The U.S. Commodity Futures Trading Commission sent subpoenas on Dec. 6 to virtual-currency venue Bitfinex and Tether, a company that issues a widely traded coin and claims it’s pegged to the dollar, according to a person familiar with the matter, who asked not to be identified discussing private information.'

This should be much more visible. The market is panic selling on effectively old news.

It's not “old news” if it wasn't publicly known in the past (and if the market had known it already, no one would be panic selling based on it.)

Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether

#140

Post by ceejayoz »

g09980 wrote: post #129
onewhonknocks wrote: post #125

They updated the article several hours later with: 'The U.S. Commodity Futures Trading Commission sent subpoenas on Dec. 6 to virtual-currency venue Bitfinex and Tether, a company that issues a widely traded coin and claims it’s pegged to the dollar, according to a person familiar with the matter, who asked not to be identified discussing private information.'

This should be much more visible. The market is panic selling on effectively old news.

It's not old news if we didn't know about it until now.
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