71–80 of 267 posts
> there was never more than $61.5 million backing Tether, even as more 442 million coins were circulating at one point. Ah, pulling the classic "fractional reserve" I see.
Hah. At one point Tether was claiming, during the days where they were holding on to the "1:1 backing!" that they were banking $2 billion A WEEK. And yet the cryptofans were telling us we were curmudgeons for not buying into the hype (or in this case, the bullshit).
Earlier quoted context omitted.
I'm not saying they shouldn't be shut down, but I genuinely wonder how that process would work. People don't have an account with Tether itself, so how would they be able to compel people to "return?" the Tethers and get their cash back?
* They don't need to? If Tether, the company, disappeared, the market can decide what to do with the, now entirely unbacked, Tether cryptocurrency. * Tether, the company, can freeze specific Tethers they have issued, making them unusable as currency. Whoever shuts them down might be able to force them to do this en masse.
Earlier quoted context omitted.
fiat debasing the currency. What I find ironic is that the crypto ecosystem still ended up with something like central banks, only in this case their mandate is make money for its owners, and they have no accountability or obligation to serve the general public.
> their mandate is make money for its owners, Isn't this pretty much the description of every company? I understand feduciary responsibilities blah blah, but if the company didn't think they could do both then they wouldn't be running the legitimate buisness. If it was started to intentionally dupe people that's an entirely different thing.
For the most part, sure. But that's the parent's point, I think. Central banks are not companies, they are part of the public financial infrastructure of a nation (or, in the EU case, group of nations).
Earlier quoted context omitted.
fiat debasing the currency. What I find ironic is that the crypto ecosystem still ended up with something like central banks, only in this case their mandate is make money for its owners, and they have no accountability or obligation to serve the general public.
> their mandate is make money for its owners, Isn't this pretty much the description of every company? I understand feduciary responsibilities blah blah, but if the company didn't think they could do both then they wouldn't be running the legitimate buisness. If it was started to intentionally dupe people that's an entirely different thing.
There world is full of cases where products or services are degraded in order to maximize profit. Has DRM ever made for a better gaming experience? Do clickbait articles result in a better informed public?
Earlier quoted context omitted.
> crypto ecosystem still ended up It's decades from its final form.
Perhaps. But we're, what? 10 years in and so far crypto has enabled 'I encrypted your data!' scams, caused political instability, been a vehicle for highly volatile investment (but the world wasn't hurting for such opportunities...), and served as a fine buzzword for dev teams around the world to get a sack of cash to update some systems. That's a pretty poor result for 10 years of this much investment and focus. The…
Earlier quoted context omitted.
Lending rates for USDT on the major decentralized lending platforms are more favorable than other stablecoins.
The lending rates are higher because lenders are paid a premium for owning a potentially worthless (USDT denominated) credit. The idiom that comes to mind is "picking up pennies in front of a steamroller".
https://compound.finance/markets/USDC
https://compound.finance/markets/USDT
For example, on October 7, it shows USDT at over (sorry, "north of") 13%, while USDC was (sorry, "clocked in at") ~5%.
Earlier quoted context omitted.
The lending rates are higher because lenders are paid a premium for owning a potentially worthless (USDT denominated) credit. The idiom that comes to mind is "picking up pennies in front of a steamroller".
Basic question: why doesn't this affect the currency pair exchange rate? If lending rates reflect the (realistic!) idea that holding 1 USDT is less valuable than holding 1 USD, how does 1 USDT trade at par?
Earlier quoted context omitted.
The SEC is in the business of protecting investors not destroying peoples savings over a few inaccuracies. Why would misleading statements ever result in a shutdown of a company instead of a fine?
Because the "misleading statement" (i.e. deliberate lie) is the entire basis of Tether's business. The service they claim to provide is fiat backing for their cryptocurrency and they didn't do that. That's not "a few inaccuracies", it's fraud.
I don't understand why this is something they can settle rather than something that gets them completely shut down.
> there was never more than $61.5 million backing Tether, even as more 442 million coins were circulating at one point. Ah, pulling the classic "fractional reserve" I see.
fiat debasing the currency. What I find ironic is that the crypto ecosystem still ended up with something like central banks, only in this case their mandate is make money for its owners, and they have no accountability or obligation to serve the general public.
So, like private currency-printing banks before government monopolies (and like private banks, which subject to central regulation still create money though they don't print currency), not like central banks.