Actually, this is good for tether
U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether
271–280 of 421 posts
Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether
#272Earlier 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.
Here’s what I don’t understand. You can exchange bitcoins for fiat currency. But afaik you can’t exchange USDT for fiat. So why is anyone willing to take the risk of holding on to USDT? Why are any exchanges even willing to touch it?
You can't _easily_ exchange bitcoins for fiat currency, that's why USDT exists. Many banks are not accepting deposits coming from some shady offshore bank into a "normal people" account.
The average Joe who's paper rich because he has 100 bitcoins on an exchange and sells them, there's a good chance their local bank branch won't be happy if he's receiving a wire transfer of $1M from the Virgin Islands or Cyprus. So instead, they keep that $1M as USDT and they can keep trading with it and still be paper rich.
The same applies to exchanges, a lot of them are totally unbanked in the US. USDT allows them to play with Monopoly USD instead of the real thing.
Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether
#273Earlier quoted context omitted.
Here’s what I don’t understand. You can exchange bitcoins for fiat currency. But afaik you can’t exchange USDT for fiat. So why is anyone willing to take the risk of holding on to USDT? Why are any exchanges even willing to touch it?
That's where I also get confused. So far the reasons I could come up with are: - the exchange got bought out silently and is now owned/controlled by the people behind tether - the exchange got paid to use tether (for example 0.5% of the volume as incentive) - the exchange holds a part of tether's fiat as guarantee - the exchange is run by people who are inexperienced in appraising counterparty risk - the exchange is…
I have a much simpler explanation:
the exchange is a fraud.
Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether
#274Summary for newbs: Bitfinex is a crypto exchange kinda based in Hong Kong and kind of based in Taiwan (this seems to change depending on convenience.) Taiwan recently started becoming more rigorous about monitoring international USD wires, and lots of Bitfinex users had their money stranded in Taiwan. Bitfinex stopped supporting US customers because of these difficulties (AFAIK most customers did eventually get their…
dumb question but how is it minted? Every time someone wants to buy one, they print one? they have a limit?
Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether
#275Earlier quoted context omitted.
That would be the SEC's domain. If CFTC is getting involved it's probably because they are potentially manipulating the price on a regulated futures contract.
But bitcoin futures didn't start until Dec 17, and the subpoena was sent Dec 6, so that would imply they're messing in futures based on some other commodity.
You are correct about the dates but the regulatory planning and preparation for the CFTC regarding the futures contracts has been a long process. CFTC had jurisdiction and interest in assessing asset pricing conditions leading up to the contract launch.
Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether
#276Earlier quoted context omitted.
Can you? Any actual, verified customer of Tether here willing to provide a demo?
I know that they offer it. And I know that I don't hear anyone complaining about them not honoring it, so I assume it works. I suppose it's theoretically possible they just offer it and nobody has even tried to take advantage of it, but that seems somewhat implausible to me.
I love how much you're defending and willing to go to bat for something you haven't tested yourself nor seen any real world examples of. Why?!
Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether
#277What bothers me more than anything in this isn't the existence of Tether and the suspicious behavior of Tether/Bitfinex players...
It's that Bittrex and others are attempting to become mainstream and they've accepted these USDT since forever, and they continue to accept them well after the suspicions were public.
This is a black stain on the exchanges. It also personally makes me cynical of the entire space. I moved my mainstream coins off of Bittrex and back into GDAX where it seems safer.
Why can't profitable exchanges like Bittrex and Kraken self-regulate?? Over and over again the invisible hand of the market is proved to be eclipsed by the visible hammer of the regulator (which can't come soon enough, by the way).
Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether
#278Summary for newbs: Bitfinex is a crypto exchange kinda based in Hong Kong and kind of based in Taiwan (this seems to change depending on convenience.) Taiwan recently started becoming more rigorous about monitoring international USD wires, and lots of Bitfinex users had their money stranded in Taiwan. Bitfinex stopped supporting US customers because of these difficulties (AFAIK most customers did eventually get their…
dumb question but how is it minted? Every time someone wants to buy one, they print one? they have a limit?
They just create one out of thin air and claim that it is backed by real money. But they don't tell you where that money is actually being held, and their auditor recently resigned, so there is no trustworthy independent verification that this money really exists.
Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether
#279Earlier quoted context omitted.
In the long term, perhaps, but in the short term there's going to be MtGox-or-worse level carnage in the markets if Bitfinex/USDT is exposed as a scam and people start panic selling to cash out.
if they sell their usdt for btc, the btc price could actually rise. it just depends if they try to withdraw all together and the money leaves the crypto market
It would rise as priced in tether, with tether depreciating against the dollar. You will see larger spreads between tether exchanges and dollar exchanges, which already regularly grow into the hundreds.
If people were holding tether because they wanted to be flat with respect to the cryptocurrency market, they will likely sell their cryptocurrency on a dollar exchange, suppressing prices there.
Re: U.S. Regulators to Subpoena Crypto Exchange Bitfinex, Tether
#280Earlier quoted context omitted.
if they sell their usdt for btc, the btc price could actually rise. it just depends if they try to withdraw all together and the money leaves the crypto market
You're assuming the severity of this news would not cause Tether to devalue while BTC holders exit into real USD or fiat instead of Tether.
I keep reading about these magical places. Say that I have a 1000 BTC. What is the exchange that would allow me to sell 500 BTC and wire money to my account in:
a) Chase Manhattan Bank in New York City ( USD )
b) National Westminster Bank in London ( GBP )
c) HSBC ( Paris ), account in Euros.
The wire must show up live in 72 business hours and post to the account within 72 * 2 hours.