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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

#361

Post by aqme28 »

thedudeabides5 wrote: post #90
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.

Exactly. We've traded confidence in centralized, old world financial institutions, for decentralized, techno-utopian...financial institutions. Same s**, different marketing.

Nothing about Tether or Bitfinex is decentralized.

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

#362

Post by _jjkk »

hntrader wrote: post #326
rednerrus wrote: post #323

Earlier quoted context omitted.

Bitcoin holders.

Which BTC holders and how? What's the path from onboarding on an exchange website, to eventually getting unbacked USDT? If I put USD onto an exchange, why would the exchange give me more USDT than what I deposited (and if this never happened, then how did the first unbacked USDT come into existence)? I hold BTC but didn't use USDT in the process, just deposited normal fiat and bought BTC using that.

1. Bitfinex processes a USD deposit and dispenses USDT

2. USDT holder purchases BTC with it

3. Bitfinex purchases crypto (mostly BTC) with the USD, instead of holding it as promised

Thus the original USD of the person buying BTC at the exchange has effectively double the buying pressure on the BTC market because Bitfinex is actively investing all their USD holdings that "back" Tether into the market as well.

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

#363

Post by vkou »

xur17 wrote: post #307
ketamine__ wrote: post #266

Earlier quoted context omitted.

On an individual basis perhaps but not if you're in an S&P 500 ETF.

Go lookup a graph of the sp500 from 2000 to 2010. There are no guarantees that it will always trend up.

Go look at that same graph from 2007 to 2021. If you bought in at the top of the 2008 bubble, you'd have tripled your money by now.

Unless you're planning on retiring in the next 10 years, buy stocks.

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

#364

Post by Apocryphon »

nemo44x wrote: post #313
mumblemumble wrote: post #300

Earlier quoted context omitted.

This statement, minus the political content, sounds very, very, very similar to what I was hearing about tech stocks a bit over 20 years ago, and houses about 15 years ago. Maybe that means something, maybe it doesn't. If I had some way of knowing, I'd have a lot more money than I am now. It's worth remembering, though, that prices are just that: prices. Nothing more, nothing less.

Yeah me too - I remember when AMZN was $2. I remember when AAPL was 28 cents (before splits, etc). I remember when the Internet had a host of pundits proclaiming it was a dying fad in 2001. And most anyone who bought a house at the peak of the bubble is doing quite well if they still have it today.

Those stocks were issued by businesses that were providing goods and services for people and being paid in return.

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

#365

Post by hntrader »

_jjkk wrote: post #362
hntrader wrote: post #326

Earlier quoted context omitted.

Which BTC holders and how? What's the path from onboarding on an exchange website, to eventually getting unbacked USDT? If I put USD onto an exchange, why would the exchange give me more USDT than what I deposited (and if this never happened, then how did the first unbacked USDT come into existence)? I hold BTC but didn't use USDT in the process, just deposited normal fiat and bought BTC using that.

1. Bitfinex processes a USD deposit and dispenses USDT 2. USDT holder purchases BTC with it 3. Bitfinex purchases crypto (mostly BTC) with the USD, instead of holding it as promised Thus the original USD of the person buying BTC at the exchange has effectively double the buying pressure on the BTC market because Bitfinex is actively investing all their USD holdings that "back" Tether into the market as well.

Good explanation. Why do they do step (3)? Aren't they just opening themselves up to massive legal liability?

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

#366

Post by vkou »

UncleMeat wrote: post #265
kragen wrote: post #249

Earlier quoted context omitted.

But I'm not talking about system failure, primarily; I'm talking about day-to-day life for somewhere between one third and two thirds of people, most of whom aren't using Bitcoin yet.

The same four countries get brought up by BTC proponents all the time. Yes, evading authoritarian regimes can be useful. But like 1/3 of the planet lives in just India/China. Going from "a use case is sending cash from the US to your family in Iran" to "2/3 of the world population wants this" is a big leap.

Not to mention that the reason you can't send money to Iran is not because of any problem in Iran - it's because the United States doesn't want you to do it.

If you live in the US, and you are using bitcoin to circumvent the embargo, you're just adding to the list of crimes you're committing.

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

#367

Post by kragen »

ordinaryradical wrote: post #271
kragen wrote: post #207

Earlier quoted context omitted.

If you live in a country with a highly functional banking system and no kleptocracy, Bitcoin is probably a bit puzzling unless you have family in Cuba. But it's not puzzling at all for those of us who live somewhere in the middle of the broad spectrum between Switzerland and Somalia, because most places have a little kleptocracy. Argentina is far from being "a failed state," but if you want to send US$500 abroad via…

This is the most cogent answer I've seen regarding BTC utility for those living under less stable regimes. Usually it's a hand-wavy "something something Venezuela something," which, as bad as Venezuela is, makes it seem like crypto is only really relevant in exceptional cases of instability. Thanks for the effort.

I'm glad you found it useful!

If we're talking about political regimes, though, I don't think we're even talking about "less stable" regimes—whatever you might think about Cuba ethically, old Raúl and his brother have been in power there for over 60 years and show no signs of losing control, and I don't see any signs of incipient revolution in Indonesia, PRC, Mexico, or Vietnam either. Here in Argentina we've remained democratic since 01983, electing presidents from three different political parties (UCR, PJ, and PRO), and there's no serious insurgency. It's the economy and government policy that are ruinously unstable, to a point that seems satirical to anyone accustomed to the US, but is lamentably common worldwide.

Thank you for the ego strokes!

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

#368

Post by jdemaeyer »

vmception wrote: post #290
dudus wrote: post #272

I've been following Tether for quite a long time. I have no absolute proof it is a scam but the writing is on the wall. Here are some facts. - The current Market Cap of USDT is 34 Billion Dollars. It was 4B this time last year. Since the value is pegged this means there has been an influx of cash of 30 B into this shady company in the last year alone. Who invested this money? We have no idea since Tether doesn't disc…

Almost all fiat deposits into Bitfinex create USDT. Thats an additional fact that the amount is in line with the amounts that would be deposited into any big exchange. If Coinbase minted USDC whenever someone deposited, you would see the same kind of growth. The basis of your entire post is assuming impropriety based on pretty normal behavior with the addition of the business quirk of when USDT is created. The abilit…

If fiat deposits into Bitfinex create USDT, shouldn't fiat withdrawals from Bitfinex burn USDT?

I'm having trouble to find comprehensive data on USDT burns but https://coinmarketcap.com/headlines/news/tether-just-burned-... seems to suggest that one billion is extraordinary (and those weren't removed from circulation but swapped to another chain), and Tether finds it Twitter-worthy when they burn 100 million: https://twitter.com/Tether_to/status/1225088948243968005

For sure I don't expect Bitfinex fiat withdrawals to match fiat deposits, but 100 million USD withdrawn vs 30 billion deposited seems unordinary?

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

#369

Post by _jjkk »

hntrader wrote: post #365
_jjkk wrote: post #362

Earlier quoted context omitted.

1. Bitfinex processes a USD deposit and dispenses USDT 2. USDT holder purchases BTC with it 3. Bitfinex purchases crypto (mostly BTC) with the USD, instead of holding it as promised Thus the original USD of the person buying BTC at the exchange has effectively double the buying pressure on the BTC market because Bitfinex is actively investing all their USD holdings that "back" Tether into the market as well.

Good explanation. Why do they do step (3)? Aren't they just opening themselves up to massive legal liability?

Some believe this is an intentional Ponzi scheme to print some money for the owners of Tether and Bitfinex, others believe they had good intentions at first, but through bad investment or otherwise got underwater, and started "investing" their USDT-backing dollars to claw back up.

Bitfinex originally denied relation to Tether but it's been proven that was a lie.

The worry is, at some point there could be a "run" on Tether, when the curtains are pulled back, where all the USDT-BTC traders who happen to have USDT holdings and they suddenly become worthless because nobody wants to trade USDT-BTC anymore at 1-1.

As long as "public confidence" in USDT continues, the charade will too

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

#370

Post by mcintyre1994 »

dudus wrote: post #272

I've been following Tether for quite a long time. I have no absolute proof it is a scam but the writing is on the wall. Here are some facts. - The current Market Cap of USDT is 34 Billion Dollars. It was 4B this time last year. Since the value is pegged this means there has been an influx of cash of 30 B into this shady company in the last year alone. Who invested this money? We have no idea since Tether doesn't disc…

> There's no way to transfer USDT into USD. The few exchanges that say they offer withdraws actually don't if you go and try.

So what actually happens when people sell Bitcoin? They get USDT on an exchange and then can never get cash out? Is there some convoluted series of trades you can make from USDT -> ??? -> USD or something instead? And people selling Bitcoin have made enough profit to just ignore the overhead of those trades I guess?

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