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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

#181

Post by darawk »

s73ver_ wrote: post #175
darawk wrote: post #138

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

You know they state in their TOS that they're under no obligation to do so, right?

Yes, but you know that in reality, you can go do it right now, right?

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

#182

Post by achompas »

seppel wrote: post #177
ebbv wrote: post #31

Earlier quoted context omitted.

You're skipping a key bit here; billions of Tethers magically appeared on the market in the last month and were used to buy BTC in suspiciously regular fashion, in 100 million USDT amounts, and with no clear evidence that it was actually purchased by anyone using real USD.

Ok, so they printed billions of Tethers and bought BTC with them, I get this part. What I don't get is: This means somebody sold BTC for billions of USDT (instead USD!). Who is doing this? Why would you sell for USDT instead USD? Maybe there some daytraders on the exchanges that go in and out the Tether every day, yeah. But that should not account for that much. Who is hodling that giant pile of USDT? And why?

> Who is doing this? Why would you sell for USDT instead USD?

On many international exchanges, USDT are the easiest way to convert BTC to a (supposedly) USD-backed asset.

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

#183

Post by TeMPOraL »

stusmall wrote: post #101
gressquel wrote: post #4

Its shocking how they have been allowed to continue printing "fake money" for so long. There were rumours going around long before christmas. Its about time this 'scam' was exposed.

I'm not very familiar with this world, but that seems fast. I always assumed the world of financial crime enforcement moved like molasses. When I started hearing those rumors I just assumed it'd be months after the crash before the feds showed up. Maybe I'm just cynical. But I 100% agree, its about time.

My impression from watching financial crimes play out in the news is this: there's a long, slow period of investigations, interviews, etc. and then suddenly people get dragged out in the middle of the night in handcuffs.

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

#184

Post by rmrm »

TeMPOraL wrote: post #176
rmrm wrote: post #117

Earlier quoted context omitted.

Their assets equal liabilities in either case (whether selling USDT directly for USD, or cyclling them through BTC). Call it what you will, but in neither scenario is anyone rich. Tether if backed by USD at the end of the day is revenue neutral. What am I missing?

Tether being printed out of thin air if they're not backed by USD?

I dont understand your question.

I think the math is fairly straightforward. There is a USD/USDT driven cross. Creating and destroying USDT is straightforward there. There is also a BTC/USDT cross. That creates a drive for USDT. If that demand to sell BTC and buy USDT bids up USDT, then USDT would be created, and the BTC would convert back to USD. I agree that Tether is not forthcoming that this happens, but yes this is exactly what I would expect to happen. Its not mysterious sounding to me, or necessarily nefarious. I dont understand why Im beimg downvoted, its a discussion about generic market mechanics. We can leave bogeyman words out of it.

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

#185

Post by s73ver_ »

darawk wrote: post #181
s73ver_ wrote: post #175

Earlier quoted context omitted.

You know they state in their TOS that they're under no obligation to do so, right?

Yes, but you know that in reality, you can go do it right now, right?

And you know that, in reality, it's not guaranteed, right?

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

#186

Post by darawk »

thinkmoore wrote: post #166
darawk wrote: post #134

Earlier quoted context omitted.

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.

My understanding is that their terms of service say that they have no legal obligation to do so, regardless of where you have a bank account...

That's correct. However, in practice, they do do it.

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

#187

Post by TeMPOraL »

darawk wrote: post #181
s73ver_ wrote: post #175

Earlier quoted context omitted.

You know they state in their TOS that they're under no obligation to do so, right?

Yes, but you know that in reality, you can go do it right now, right?

Can you?

Any actual, verified customer of Tether here willing to provide a demo?

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

#189

Post by darawk »

thinkmoore wrote: post #172
darawk wrote: post #138

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

Who is "you"? From the terms of service: "Absent a reasonable legal justification not to redeem Tether Tokens, and provided that you are a fully verified customer of Tether, your Tether Tokens are freely redeemable... Furthermore, residents of certain U.S. states are not permitted to be customers of Tether; are not permitted to cause Tethers to be issued or redeemed; and, are not permitted to hold Tether Tokens. Begi…

You is anyone. You can go open an account right now and do it.

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

#190

Post by JumpCrisscross »

TeMPOraL wrote: post #57
JumpCrisscross wrote: post #7

Cryptocurrencies are in an interesting middle ground, from a regulator’s political perspective. They’re complicated and stand to harm mostly those who inflicted it on themselves. For an ambitious regulator looking forward to an administration’s nominating committee, Senate confirmation hearing or even campaign trail, that makes it unattractive relative to e.g. insider-trading hedge fund managers or Medicare fraudster…

> They’re complicated and stand to harm mostly those who inflicted it on themselves They're about as "inflicted on yourself" as most fraud is. You could say that a grandma getting scammed by a person pretending to be a government official[0] also brought it on herself, and so did the guy scammed by an insurance MLM. The truth is, there's enough of buzz around cryptocurrencies that it starts to impact regular citizens…

> It's becoming a public issue

Pardon me, I didn't mean to say it isn't something regulators should go after. I was merely commenting on their incentives.

If you're an ambitious regulator, an easy-to-explain high-profile bust is worth its career weight in gold. "I got Martin Shkreli convicted of securities fraud" is potent and messageable. "This cryptocurrency scheme...what's are cryptocurrencies?..anyway, this scheme in Hong Kong sold other cryptocurrencies called Tethers in exchange for Bitcoin...no, we're still fighting for extradition..."

That is messy. Maybe you get a promotion. It could also backfire if it's perceived as preferential treatment of Silicon Valley.

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