can someone explain to me how a district court can sue someone? shouldn't this be the SEC or something?
Tether price manipulation
131–140 of 490 posts
Re: Tether price manipulation
#132Earlier quoted context omitted.
Plenty of companies redeem USDT for USD. I myself worked at a company that redeemed billions of dollars. The FUD on HN is approaching delusional levels.
And what does the company do with those USDT? If the money printing theory is correct, companies like yours would be the ones counteracting any sell-pressure on USDT. If the theory is not correct, companies like yours would see an at least equal buy-side demand for USDT, bringing real USD into the system. I mean, does the company hold (increasingly?) large USDT positions on their balance sheet (and would therefore be…
I worked at Circle https://www.theblockcrypto.com/post/48857/former-head-of-cir...
Re: Tether price manipulation
#133Let's say you believe that Tether is a complete fraud and will crash the market at some point. How do you take advantage of this? I'm not myself trading, but I would be interested to know how that kind of short works in practice. From what I understand, that's what bitcoin futures can be used for?
Cboe ended their bitcoin futures. As such there’s no way to bet on a bitcoin collapse that I know of, in a less risky options-like way. Shorts (if they exist) would be extremely risky, as you owe more if bitcoin rises.
CME has fairly liquid futures
https://www.theblockcrypto.com/data/crypto-markets/futures/a...
Re: Tether price manipulation
#134Earlier quoted context omitted.
The killer app for Bitcoin is escaping government fiat money that is backed by literally nothing at all and is being printed at increasingly alarming rates. 40% of all USD ever created were “made” in 2020. That will have repercussions for decades and isn’t a currency I want to stay in. https://fred.stlouisfed.org/series/M1 Ironically (or not) Bitcoin was created in 2009 right when that graph gets really crazy.
That only works when people take payment in BTC without translating the value provided back to a Fiat currency. Until that time, expansion of the USD (or other Fiat) supply impacts the "value" that BTC has.
During the gold standard, did people take payment in gold?
I don't think so...
They used paper that symbolized "withdrawal rights to gold". USD (or any other piece of paper that people agree has a value) is a perfect currency for exchange, it's just not a great store of value.
Re: Tether price manipulation
#135The problem is that in the early days of @Bitfinex'ed this was all a bit of a sideshow because there was genuinely large interest from retail and the outcome of crypto was far less certain. However three years on, crypto still does not have a "killer app" and is 99.99% used for speculation. Bitcoin's narrative has had to morph from "digital currency" to "digital gold". But in the depths of the March panic, Tether jum…
The killer app for Bitcoin is escaping government fiat money that is backed by literally nothing at all and is being printed at increasingly alarming rates. 40% of all USD ever created were “made” in 2020. That will have repercussions for decades and isn’t a currency I want to stay in. https://fred.stlouisfed.org/series/M1 Ironically (or not) Bitcoin was created in 2009 right when that graph gets really crazy.
I have a question, isn't the problem with the gold standard that the amount of dollars is fixed and in order to have enough currency to drive a rapidly growing economy you would in essence be buying a gallon of milk for .25 cents?
It seems to me that either you the amount of currency in circulation needs to increase or the value of the existing currency needs to increase.
Taking into account the gold standard was used for possibly centuries (not sure) was this problem encountered before and how was it solved?
Re: Tether price manipulation
#136>4) How the scam works:
>Tether can print infinite amounts of (worthless) $USDT.
>They then inject this into BTC, ETH, LTC, (and others) to cause prices to pump.
>Notice how during the months they stopped printing Tether, the market moves sideways or drops significantly.
>This graph also shows the extent to which USDT plays a role in Bitcoin's price action over the years.
I don't get it. This doesn't really prove anything either way. Sure it could be the case that they're printing USDT backed by nothing and using it to by cryptos, but it could very well be the case that they're printing the USDT in response to real deposits from people who want to get into crypto. Since USDT accounts for a significant portion of the crypto market, it'd be more suspicious for price to go up without a corresponding large amount of USDT being printed, because that would mean prices are going up without more money being poured into the market.
Re: Tether price manipulation
#137The problem is that in the early days of @Bitfinex'ed this was all a bit of a sideshow because there was genuinely large interest from retail and the outcome of crypto was far less certain. However three years on, crypto still does not have a "killer app" and is 99.99% used for speculation. Bitcoin's narrative has had to morph from "digital currency" to "digital gold". But in the depths of the March panic, Tether jum…
The killer app for Bitcoin is escaping government fiat money that is backed by literally nothing at all and is being printed at increasingly alarming rates. 40% of all USD ever created were “made” in 2020. That will have repercussions for decades and isn’t a currency I want to stay in. https://fred.stlouisfed.org/series/M1 Ironically (or not) Bitcoin was created in 2009 right when that graph gets really crazy.
USD is backed by being valid for the redemption of outstanding USD denominated invoices, loan repayments and tax bills, all of which ensures demand to possess the currency and are likely to continue to exist in increasing quantities in future.
"Escaping" that for something which literally is backed by nothing at all is a strange move.
Re: Tether price manipulation
#138Earlier quoted context omitted.
1 BTC will still be 1 BTC after the Tether scam and scammers are all history.
And twenty-five years on, 1 Beanie Baby = 1 Beanie Baby.
Re: Tether price manipulation
#139Earlier quoted context omitted.
People do hold USDT. I hold some myself. If you are going to buy crypto again it saves the hassle and expense of converting into fiat money and back again. The majority of exchanges can't actually hold fiat money due to regulatory issues. Also I imagine some people are hoping to avoid the taxman by keeping it in crypto though that's legally not kosher.
Why USDT and not USDC or DAI? Don't you feel like holding USDT makes you complicit in whatever shit is going on? Also, I would be very, very weary of using an centralized exchange that "can not hold fiat". With the layer-2 projects that are coming now (take a look at loopring or Stakenet), you can transact as much as you want, no gas fees and exchange fees are about the same as any CEX.
Because way more exchanges offer USDT trading. USDC / DAI are both fairly new, and aren't offered as trading pairs nearly as frequently.
Re: Tether price manipulation
#140The part I don't understand: Say the SEC takes on Tether and it falls. Why then does BTC and the crypto markets crash?
Because Tether's utility is as a legislatively advantageous on- and off-ramp for the whole crypto market.
Off-ramp: If people want to sell BTC or other volatile tokens because they want to realize profits, the obvious thing would be to sell for fiat (USD/EUR). But due to taxation and legislation this is often difficult. Stablecoins like Tether provide the utility of a low-volatility currency that fiat would fill. Main advantage is bypassing legislation.
This use is so common there is jargon for "Tethering up".
There also exist many debit cards that allow paying with stablecoins, increasing utility. The rise of DeFi and money markets for stablecoins also provides a good return on stablecoins while in theory being low-volatility.
On-ramp: If people want to buy a certain token they first go into Tether. This is usually for bypassing local legislation limiting the buying of a specific token or use of exchanges. This use is less common, I would wager.
Because of this wide-spread use of Tether, it's collapse would cause a liquidity crisis: people want to but cannot sell their Tethers for other tokens/fiat. Tether goes down from it's 1USD peg, triggering a run on Tether as people try to swap it as much as they can for anything else, driving down the price further. Meanwhile noone is willing to buy Tether. The theory proposed by OP, is that panic in the already volatile crypto market ensues, people exit for fiat where they can driving down prices everywhere. Trust in the whole market will be obliterated.
Personally, I haven't trusted Tether since the first BitFinex scandals and avoided like the plague. For my stablecoin needs, I use something that is audited and over-collateralized like DAIv2.