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Bitfinex and Tether required to end all trading activity with New Yorkers

ag.ny.gov

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Re: Bitfinex and Tether required to end all trading activity with New Yorkers

#111

Post by dgellow »

capnorange wrote: post #23

wait.. this seems contradictory to this -- https://www.theblockcrypto.com/post/95207/bitfinex-tether-ne...

This article doesn't make that much sense IMHO. You can read the settlement agreement for yourself here: https://ag.ny.gov/sites/default/files/2021.02.17_-_settlemen...

Page 4 of the agreement:

> 20. Because of Tether’s inability to conduct significant banking activity during this time, it could not itself hold dollars sufficient to back the hundreds of millions of new tethers that had entered the market. Until September 15, 2017, the only U.S. dollars held by Tether ostensibly backing the approximately 442 million tethers in circulation was the approximately $61 million on deposit at the Bank of Montreal.

That's 14% of the cash required to back the issued Tether at the time.

Re: Bitfinex and Tether required to end all trading activity with New Yorkers

#112

Post by eMGm4D0zgUAVXc7 »

pavlov wrote: post #79
lettergram wrote: post #57

It appears from the link in the settlement agreement: https://ag.ny.gov/sites/default/files/2021.02.17_-_settlemen... Tether wasn’t backed at all times. The argument was that this happened due to asset seizures in Poland and Portugal in 2017-2018. https://www.theblockcrypto.com/post/95207/bitfinex-tether-ne... Seems to me they couldn’t prove malicious intent, so they suggested they stop trading. Frankly this seems a…

> (probably is now) This kind of argumentation makes cryptocurrency proponents so insufferable. There’s no evidence Tether is backed, but somehow we can just assume in a parenthesis that they probably are, and then go on a tangential rant about banks or fiat or digital gold or something.

> makes cryptocurrency proponents so insufferable

Tether is not a cryptocurrency.

It's a cargo cult: A plain old centralized system which got the word "cryptocurrency" slapped onto it to attract dumb money.

Re: Bitfinex and Tether required to end all trading activity with New Yorkers

#113

Post by jcfrei »

raiyu wrote: post #9

Is this the first official ruling on tether that shows it isn’t backed 1:1 by the US dollar? That has long been speculated, but if this is the first official verification how does that affect the Market. Especially the self dealing of Bitfinex.

The market doesn't care. Hasn't cared for years now, just look at the Kraken USDT/USD market which is freely tradable. Tethers are mostly backed by USD - no 100% but that's because some funds were seized due to regulatory scrutiny, not because they disappeared.

Re: Bitfinex and Tether required to end all trading activity with New Yorkers

#114

Post by mumblemumble »

inter_netuser wrote: post #91
pavlov wrote: post #79

Earlier quoted context omitted.

> (probably is now) This kind of argumentation makes cryptocurrency proponents so insufferable. There’s no evidence Tether is backed, but somehow we can just assume in a parenthesis that they probably are, and then go on a tangential rant about banks or fiat or digital gold or something.

You can take redemption from tether and they will wire you the money, they are in fact registered and regulated. on several exchanges it can be exchanged into fiat, for smaller participant.s It would collapse a long time ago, if it weren't backed.

Heh. I just made another comment saying that Tether is not like Madoff, so of course I now need to make one comparing Tether to Madoff.

Bernard L. Madoff Investment Securities was also registered and regulated, and also had to wire people their money when asked. Even though they didn't actually have all the assets they said they did. He was able to keep it up for 3 or 4 decades.

It will only collapse if outflows exceed inflows for long enough to deplete their supply of assets. Which is something that is unlikely to happen for as long as this Bitcoin rocket keeps racing toward the moon.

Re: Bitfinex and Tether required to end all trading activity with New Yorkers

#115

Post by [deleted] »

eMGm4D0zgUAVXc7 wrote: post #112
pavlov wrote: post #79

Earlier quoted context omitted.

> (probably is now) This kind of argumentation makes cryptocurrency proponents so insufferable. There’s no evidence Tether is backed, but somehow we can just assume in a parenthesis that they probably are, and then go on a tangential rant about banks or fiat or digital gold or something.

> makes cryptocurrency proponents so insufferable Tether is not a cryptocurrency. It's a cargo cult: A plain old centralized system which got the word "cryptocurrency" slapped onto it to attract dumb money.

[deleted]

Re: Bitfinex and Tether required to end all trading activity with New Yorkers

#116

Post by dgellow »

andreaorru wrote: post #12

"Contrary to online speculation, there was no finding that Tether ever issued tethers [USDT] without backing, or to manipulate crypto prices," said Weinstein, a former federal prosecutor. [0] [0] https://www.theblockcrypto.com/post/95207/bitfinex-tether-ne... EDIT: For some reason I'm being downvoted, but I'm genuinely curious to understand why this news is being simultaneously interpreted in two opposite ways.

Read the settlement agreement: https://ag.ny.gov/sites/default/files/2021.02.17_-_settlemen...

Page 4 of the agreement:

> 20. Because of Tether’s inability to conduct significant banking activity during this time, it could not itself hold dollars sufficient to back the hundreds of millions of new tethers that had entered the market. Until September 15, 2017, the only U.S. dollars held by Tether ostensibly backing the approximately 442 million tethers in circulation was the approximately $61 million on deposit at the Bank of Montreal.

That's 14% of the cash required to back the issued Tether.

Re: Bitfinex and Tether required to end all trading activity with New Yorkers

#117

Post by jMyles »

lifty wrote: post #46

This news is so funny. Tether detractors see this as confirmation that they were right all along, while crypto currency fans say that this is confirmation that it was FUD all along. No bridges were built in this endeavour.

> Tether detractors see this... while crypto currency fans

Be reminded that the overlap in this venn diagram is enormous.

Re: Bitfinex and Tether required to end all trading activity with New Yorkers

#118

Post by lettergram »

35fbe7d3d5b9 wrote: post #104
inter_netuser wrote: post #91

Earlier quoted context omitted.

You can take redemption from tether and they will wire you the money, they are in fact registered and regulated. on several exchanges it can be exchanged into fiat, for smaller participant.s It would collapse a long time ago, if it weren't backed.

> You can take redemption from tether and they will wire you the money Tether says they will. Has anyone successfully done this? > on several exchanges it can be exchanged into fiat, for smaller participant.s No one says you can't trade USDT. But that requires a counterparty, and if it turns out that Tether is mostly backed by air they may evaporate as well.

That’s usually the way these things work. That’s why the AG is making statements like “stop the illegal activity” and stuff, it degrades trust. However, if you read the statement it’s a win for the crypto exchange. Only an $18m fine for supposedly “billions in fraud” (course if you read deeper, they found no fraud).

Re: Bitfinex and Tether required to end all trading activity with New Yorkers

#119

Post by [deleted] »

arberx wrote: post #44

Have no idea why ycombinator is so salty towards anything crypto. Yes, tether was wrong when they said USDT was backed by “US Dollars”. But, the conclusion is USDT is backed by something, the likes of which is probably a fractional reserve. Case is resolved, with Tether admitting no fault.

[deleted]

Re: Bitfinex and Tether required to end all trading activity with New Yorkers

#120

Post by jbirer »

lifty wrote: post #46

This news is so funny. Tether detractors see this as confirmation that they were right all along, while crypto currency fans say that this is confirmation that it was FUD all along. No bridges were built in this endeavour.

No bridges need to be built, only people saved from losses and fraud.
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