Tether price manipulation • Hacker News Board

Re: Tether price manipulation

#441

Post by gamblor956 » Sat, Jan 09, 2021, 1:06 AM UTC

doggosphere wrote: post #395

gamblor956 wrote: post #385

Earlier quoted context omitted.

Can the government seize Bitcoin directly? No. Yes, it can. The U.S. government has in fact seized Bitcoin directly and sold it at auction several times. It is arguably the single largest non-exchange seller of Bitcoin in Bitcoin's history.

It can only be taken in these events: 1) Seed phrases are discovered (ie. plaintext document or physical artifact). 2) Seed phrases are handed over by willing party. If #1 doesn't exist, then #2 is the only option.

This is the same as with cash money.

Money can only be seized if the safe is found. And the combination is handed over by a willing party.

The difference is that money is actually more secure because you don't have a public ledger telling you that it exists and who owns it and how much of it they own as you do with the public cryptos like Bitcoin and Ethereum.

Re: Tether price manipulation

#442

Post by gamblor956 » Sat, Jan 09, 2021, 1:08 AM UTC

doggosphere wrote: post #400

gamblor956 wrote: post #382

Earlier quoted context omitted.

I can do all that right now without inserting a power-wasting cryptocoin layer.

Go ahead subscribe to Pornhub with your credit card. Or donate to Wikileaks with your paypal.

Why would I pay for Porn? But on that note, the PH website still accepts several types of credit cards.

Whatever Wikileaks originally was, it is now a Russian propaganda tool. Go ahead and try to post leaks critical of Russia on Wikileaks, or for that matter, of Donald Trump. Why would I want to donate to a website that is openly seeking the destruction of my country?

Re: Tether price manipulation

#443

Post by briatx » Sat, Jan 09, 2021, 1:56 AM UTC

shuntress wrote: post #387

nebulous1 wrote: post #245

Earlier quoted context omitted.

Some exchanges have no traditional banking ties at all, so you have to send them some for of crypto in order to use them. It's also easier and quicker to move tether from one exchange to another than it is to receive a USD transfer and resend it to another, and that's ignoring regulatory issues.

This does nothing to explain the purpose of Tether. If Exchange A has no "traditional banking ties" but is where I want to trade so I need to buy crypto through Exchange B first in order to trade that crypto on Exchange A why would I buy Tether instead of BTC through Exchange B?

Maybe you do buy BTC on Exchange B.

Then you transfer to Exchange A and sell, and what do you get when you sell? Tether.

The point of Tether initially is regulatory arbitrage for Tether based exchanges. It gives them a fiat substitute without having regulatory baggage that trading in actual money would require.

Tether then turned into a lifeline for a Bitfinex bailout and now acts as a (almost assuredly illicit) liquidity provider to Tether based markets.

The only reason Tether is worth a dollar at this point is because the Tether denominated Exchanges say it is worth a dollar. They are really what backstop Tether now and are fully complicit.

Re: Tether price manipulation

#444

Post by doggosphere » Sat, Jan 09, 2021, 2:06 AM UTC

microtherion wrote: post #433

doggosphere wrote: post #432

Earlier quoted context omitted.

Yes. The solution to this is a software fork.

Did you mean "soft fork", or are you thinking of a different concept I'm not familiar with? Forks can and have been used to deal with isolated malicious incidents, but do you think they can be successful against an actor in extended control of a substantial part of the hash rate?

You can alter the hashing algorithm to one that is more ASIC resistant. Monero did this.

Re: Tether price manipulation

#445

Post by mekster » Sat, Jan 09, 2021, 2:43 AM UTC

pionar wrote: post #378

doggosphere wrote: post #374

Earlier quoted context omitted.

Lots of examples in this thread. A replacement for gold is one.

> A replacement for gold is one. Gold is relatively stable and has physical backing. BTC does not.

Bitcoin is relatively stable and has a mathematical backing. Gold does not.

Re: Tether price manipulation

#446

Post by qqii » Sat, Jan 09, 2021, 2:46 AM UTC

PragmaticPulp wrote: post #354

Tepix wrote: post #62

I agree that USDT is fishy and it may be behind a large percentage of the gains in BTC and the other coins. However, there is also another possible explanation. When investors want to buy BTC they first to go Binance and ask for USDT in exchange for USD. Binance creates new USDT for them. Then they use the USDT to buy BTC (reverse causality). Just saying it's possible, but I believe Jacob Oracle to be right.

> When investors want to buy BTC they first to go Binance and ask for USDT in exchange for USD. Binance creates new USDT for them. Then they use the USDT to buy BTC (reverse causality). But why sell them USDT first and then sell them BTC in exchange for the USDT? Why not just sell them BTC directly? That's the issue.

The liquidity in BTCUSDT on binance is much higher so you're less likely to encounter slippage. You have to also remeber non US customers that use exchanges, for them it makes a lot of sense to exchange their native currency to USDT.

Re: Tether price manipulation

#447

Post by qqii » Sat, Jan 09, 2021, 2:51 AM UTC

WMX123 wrote: post #391

lippel82 wrote: post #370

Earlier quoted context omitted.

It does make sense. The price of BTC in USD is roughly the same on every exchange. If some exchanges allow USD and USDT interchangeably, the BTC price can be driven up by trades that are conducted in USDT. The price on Coinbase will adapt to that.

how will Coinbase "adapt"? it's a walled garden.

Individuals and bots will take advantage of the price discrepancies between exchanges by purchasing BTC on the cheaper exchange, sending the BTC to the more expensive exchange and selling it. As long as its possible to do this different exchanges normally stay within a few % of each other.

Re: Tether price manipulation

#448

Post by tdeck » Sat, Jan 09, 2021, 3:24 AM UTC

Here's a good write-up about the issues with Tether from a few years ago:

https://tonyarcieri.com/the-tether-conundrum

Re: Tether price manipulation

#449

Post by doggosphere » Sat, Jan 09, 2021, 3:25 AM UTC

incrudible wrote: post #434

doggosphere wrote: post #413

Earlier quoted context omitted.

Bitcoin is bits of data on a network. It does exactly what its supposed to do; a dictionary for strings to integers. Securing external value to people is not a goal or responsibility of Bitcoin. That's simply a consequence to how we as humans choose to use scarce assets.

> Securing external value to people is not a goal or responsibility of Bitcoin. Fair enough, but then your comparison to physical gold is meaningless. Physical gold is generally used to store value, not to transfer it. For that purpose, you have paper money (or paper gold such as futures) which is cheap to transfer.

Gold has had thousands of years to equalize in value.

Bitcoin is about 12 years old.

Re: Tether price manipulation

#450

Post by JohnWinner » Sat, Jan 09, 2021, 4:29 AM UTC

doggosphere wrote: post #403

rednerrus wrote: post #351

Earlier quoted context omitted.

The hurdle for bitcoin is finding a way for people to turn it into a currency they can use. This is where you end up with a centralized exchange layer built on top of it. I can make a $12,000,000 transaction for $.35 but if I actually want to get the money, I have to pay 2.5% to a legit exchange or take my chances on some janky ass exchange. Why not just transfer the money via ACH and pay the small fee and save mysel…

In a long enough time frame, people transact with cryptoassets directly and don't need to exchange into fiat. We are early in this development, money as we know it is changing.

Over a long enough time frame the chances that you get hacked, scammed or make a fatal mistake and lose all your cryptos is high. Putting anything more than pocket money in this is idiotic.