Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

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

bloomberg.com

Post reply on HN
Print view View original

351–360 of 421 posts

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

#351

Post by JumpCrisscross »

mtgx wrote: post #342
fpgaminer wrote: post #29

So, how does this work legally? Bitfinex isn't a U.S. based company and doesn't work with U.S. citizens. The article says where it's based is unknown. Does the CFTC have the authority to subpoena them? Is it because they're claiming Tether is USD pegged, so they gain authority because of their use of the dollar? Honestly just a curious question. (I'm not looking for snarky answers to the effect of "world police".)

I'll hijack this thread so everyone gets to see this. STOP reading Bloomberg for cryptocurrency news! I don't know if they did this on purpose or not to manipulate the market and so some of their rich friends can get in at a cheaper price, but I find it quite unacceptable for a publication such as Bloomberg to mess up the fact that it was posting a two months old story . But that's not even the worst part. No, the wo…

FYI, when people ask “why is a private transaction between two willing participants a problem,” this is why. Nobody blames themselves for getting duped into a scam. No, it’s Bloomberg’s fault for calling the spade a spade.

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

#352

Post by phil21 »

kasey_junk wrote: post #323
andrewla wrote: post #309

Earlier quoted context omitted.

You try it - try to get more than 10,000 USD cash out of your bank, and then tell me how sweet that fiat money is (much less doing this without any questions asked). This is not to send out the ridiculous trope of “fractional reserve banking is a fraud” or anything; Chase, for the moment, is solvent, and recent events have made it clear that the Federal Reserve will sooner barbecue children than let a bank customer n…

I have no opinion about the soap opera of crypto currencies but the implication that it is hard to get more than 10k in cash from a bank is ludicrous. I’ve gotten more than that out of a credit union located in the basement of a grocery store using literally the exact same form that is use to exchange coins for bills and taking less time. Maybe the assertion is you can’t do it without an irs notice from the bank? Sur…

To be fair this is very hit or miss, depends largely on your transaction history, the specific bank (and branch) policies, if that bank manager is having a bad day, etc. And that's the problem.

I've been hit by the insanity of "yes it's your money but you can't have it" from banks before, and it's one of those things you think everyone else must be a borderline criminal and/or exaggerating until it happens to you.

Anecdote isn't entirely useful here. The fact is they can do it, and even with sizable assets I had far fewer avenues of recourse than one may initially think. This made me really rethink banking security in a new sense.

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

#353

Post by jey »

darawk wrote: post #253
PeterisP wrote: post #219

Earlier quoted context omitted.

Not if you're an "U.S. Person".

Yes, but that's irrelevant. The fact that some groups of people can arbitrage the price of tether against USD means they ought to be equivalent.

This is only true if there really is a USD for every USDT out there in the market. If it turns out to be a fake, the whole thing comes crashing down and becomes unpegged as soon as growth stops, i.e. as soon as we run out of "greater fools" to keep supplying sufficient inflow of USD for everyone that's trying to cash out.

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

#354

Post by oculusthrift »

vzcx wrote: post #279
oculusthrift wrote: post #242

Earlier 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

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.

btc would rise in terms of the real USD as well because the demand for it would increase.

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

#355

Post by Negitivefrags »

rmrm wrote: post #117
ebbv wrote: post #104

Earlier quoted context omitted.

They're solvent in that scenario, sure, because they committed fraud. That's the great thing about fraud, getting rich off of it.

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?

What you are missing is that they created money out of nowhere. No individual loses directly, but it affects the overall money supply. In this case, the price of bitcoin was inflated artificially by buying it with an asset that was created out of nowhere.

It's like having a printing press that creates legitimate money. No individual loses, but the prices of everything you can buy will artificially increase (or another way to look at that is the currency deflates) if you print enough of it.

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

#356

Post by FireBeyond »

darawk wrote: post #189
thinkmoore wrote: post #172

Earlier quoted context omitted.

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.

Other than US persons.

And you are required to deposit a minimum of $10,000 USD fiat.

And you are required to wait 3 months for verification.

So, sure, go ahead and do it "right now", subject to those caveats.

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

#357

Post by FireBeyond »

darawk wrote: post #205
alistproducer2 wrote: post #196

Earlier quoted context omitted.

You didn't mention the $50K minimum, which obviously weeds out most people who would want to claim USDT->USD: For the time being, we will only process requests above $50,000 in size. We believe that by the time we are able to get to the smaller withdrawals, other, less cumbersome

That only applies to the special withdrawal provision for US customers. Taiwanese domestic wires of all sizes have been flowing unimpeded this whole time.

> Taiwanese domestic wires of all sizes have been flowing unimpeded this whole time.

Your only knowledge of this is based on "surely we'd hear of people complaining on English language forums if they weren't able to".

And at the very least, if you do wish to do anything, you are required to maintain at least $10,000 USD (not USDT) and wait for up to 12 weeks for verification.

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

#358

Post by FireBeyond »

darawk wrote: post #291
thebiglebrewski wrote: post #276

Earlier quoted context omitted.

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?!

I'm not going to bat for them. I'm explaining the way i've reasoned about the situation. If you disagree with my reasoning, feel free to explain why. Here's the chain: 1. Bitfinex claims to offer wires to Taiwanese accounts. 2. Bitfinex does redeem Tether 1:1 for USD (nominally, within your Bitfinex account). 3. Bitfinex claims to wire that redeemed USD to any Taiwanese account without delay or haircut. Now, given th…

You are going to bat for them, in the fact that this comment is the first where you've made any note of "claims", and "expects".

All your other posts on this thread have made these as statements of fact. "Bitfinex offers wires", "Go ahead and open an account right now", etc.

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

#359

Post by rmrm »

Negitivefrags wrote: post #355
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?

What you are missing is that they created money out of nowhere. No individual loses directly, but it affects the overall money supply. In this case, the price of bitcoin was inflated artificially by buying it with an asset that was created out of nowhere. It's like having a printing press that creates legitimate money. No individual loses, but the prices of everything you can buy will artificially increase (or anothe…

If they hold the bitcoin, yes. I dont think anyone is missing that.

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

#360

Post by darawk »

FireBeyond wrote: post #357
darawk wrote: post #205

Earlier quoted context omitted.

That only applies to the special withdrawal provision for US customers. Taiwanese domestic wires of all sizes have been flowing unimpeded this whole time.

> Taiwanese domestic wires of all sizes have been flowing unimpeded this whole time. Your only knowledge of this is based on "surely we'd hear of people complaining on English language forums if they weren't able to". And at the very least, if you do wish to do anything, you are required to maintain at least $10,000 USD (not USDT) and wait for up to 12 weeks for verification.

Yes, that is correct. But I think that's a pretty reasonable provision. Taiwan has internet, and people from Taiwan trade Bitcoin.
Post reply on HN